Public Bill Committee

[Ann Wintertonin the Chair]

Schedule 14

Burial grounds: removal of human remains and monuments

Amendment proposed [this day]: No. 60, in schedule 14, page 210, line 24, at end insert—
‘( ) If the remains were interred less than 25 years ago, the nominated undertaker shall make every reasonable effort to identify the relatives or personal representative of the deceased, and consult those people as to how the nominated undertaker proposes to carry out its functions under this Schedule with respect to the disposal of the remains or monument.’.—[Stephen Hammond.]

Question again proposed, That the amendment be made.

Tom Harris: Schedule 14 deals with moving human remains and monuments from burial grounds and re-interring or cremating the remains necessary to construct Crossrail. Before that happens, under the Bill the nominated undertaker, as it were, must publish the proposal twice in a local newspaper and erect a site notice unless the remains were interred more than 100 years ago and the Secretary of State considers that no relative or personal representative is likely to object. That will give relatives and personal representatives the opportunity to re-inter or cremate the remains themselves.
The provisions have a precedent in the Channel Tunnel Rail Link Act 1996, and have not proved controversial. Under the amendment, if the interment took place less than 25 years ago the nominated undertaker would have to seek out relatives or personal representatives, which would place substantial additional burdens on the nominated undertaker. In addition, the requirement in the amendment is open-ended, so that if no personal representative were found, every relative would have to be sought, which I am sure was not what the hon. Member for Wimbledon intended. Lawyers look at the exact wording of such proposals with great care, and it would be difficult to establish whether sufficient steps had been taken in any particular case and thus at what point the nominated undertaker could proceed with his work.
The amendment is also unlikely to have any substantive effect. As reported in the Crossrail environmental statement, Cross London Rail Links has carried out an archaeological assessment of the land affected by the project, expected scheme impacts and appropriate mitigation measures. The assessment indicated that the project is not expected to affect any interments made within the past 25 years. For those reasons, I do not support the amendment, and I hope that the hon. Gentleman will withdraw it.

Stephen Hammond: I welcome you back to the Chair, Lady Winterton.
I am not sure that I agree with the Minister that the amendment would place a substantial burden on the nominated undertaker. I was interested to learn that the Minister’s favourite profession advised him that we would have to try to identify every relative. Clearly, that is not my intention—perhaps the amendment should have said “a relative” rather than “the relatives”.

Tom Harris: Dead right.

Stephen Hammond: There is a lot of gallows humour this afternoon. I did not intend that the amendment should impose considerable burdens on people, but as drafted it would do so. I therefore beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 14 agreed to.

Clause 50 ordered to stand part of the Bill.

Clause 51

Disposal of Crown land

Stephen Hammond: I beg to move amendment No. 61, in clause 51, page 31, line 36, at end insert
‘after consultation with the Chief Executive of the Royal Parks Association and any other relevant interested parties’.

Ann Winterton: With this it will be convenient to discuss the following amendments: No. 63, in clause 51, page 31, line 41, leave out ‘appears to the Secretary of State’ and insert
‘the Secretary of State has determined’.
No. 62, in clause 51, page 32, line 2, leave out ‘appears to’, and insert ‘has been proven by’.

Stephen Hammond: There was some confusion about the amendments. There was initially some transposition of their wording, but that problem has been corrected on the amendment paper. The Minister was quick to spot the transposition, and I congratulate him on doing so. I have also made an error in amendment No. 61, which I am sure will cause him to make some other point. The amendment should state “Royal Parks Agency”, not “Royal Parks Association”.
Clause 51 looks at the disposal of land managed by the Royal Parks Agency or the Crown Estate Commissioners on behalf of the Crown. Under the clause, the Secretary of State may grant a lease, easement or other right over such land. The purpose of my amendment is to avoid any perceived conflict of interest resulting from the fact that, as the explanatory notes point out, the Secretary of State is also
“the legal personality of the Royal Parks Agency”.
It would require the Secretary of State to consult with the operational head of the Royal Parks Agency before exercising his powers in respect of the Crown land, and it would introduce a consultation process with other interested parties. It would also ensure that the basis of any decision to dispose of Crown land is as robust as possible, and is informed by consultation with the most appropriate parties.
Amendments Nos. 63 and 62 are designed to achieve the same effect. They would make a minor change to the wording of the clause, and would require the Secretary of State to demonstrate that the land in question was needed for Crossrail. A consistent theme of mine during our sittings has been to ensure that we provide accountability and responsibility while giving the Secretary of State the flexibility and the exceptional powers that he wants. I hope that the Minister will look favourably on the amendments.

Tom Harris: Clause 51 deals with technical constraints arising under the Crown Lands Act 1851 and the Crown Estate Act 1961. Because land forming part of the royal parks or the Crown estate belongs to the Crown, it does not need to be compulsorily acquired, but it may none the less need to be used if we are to successfully build and operate Crossrail. Clause 51 applies only to land within the limits of deviation for the scheduled works, and thus within the limits of land to be acquired or used. Its provisions have effect only where the body responsible for managing the land—the Secretary of State in the case of royal parks and the Crown Estate Commissioners in the case of Crown estate land—considers that it is required for Crossrail. It might be helpful if I gave an example to explain why we need clause 51.
To comply with safety requirements we intend to build a shaft in Hyde park. The likely significant impacts of the shaft were assessed in the environmental statement that was deposited with the Bill and those affected had the opportunity to petition against our proposals. Naturally, we discussed our plans with the Royal Parks Agency. In addition, some land required to provide the subsoil land for the Crossrail tunnels is owned by the Crown Estate Commissioners. Amendment No. 61 would require the Secretary of State to consult the chief executive of the royal parks association and any other relevant interested parties before granting a lease, easement or other right over a royal park. However, as I have explained, our proposals for Hyde park have already been the subject of extensive consultation during proceedings on the Bill.
On the question of the royal parks association, as the hon. Gentleman has already pointed out he meant the Royal Parks Agency, which is an executive agency of the Department for Culture, Media and Sport. The status of the agency may change from time to time, so it would be inappropriate to write the Department’s internal management structures into the Bill. That has some relevance, given our earlier discussion about whether to name Network Rail in the Bill. Furthermore, a requirement to consult
“any other relevant interested parties”
would give rise to uncertainty as to who they were. After listening to the hon. Gentleman I am not clear what other interested parties he has in mind.
Amendment No. 62 would require the Secretary of State to prove that land within a royal park is needed for, or in connection with, the construction of Crossrail before he or she could grant any lease, easement or other right in relation to that land. The Secretary of State granting a lease, easement or other right will, at the relevant time, have to make a judgment as to whether it appears to them that the land is required. To include a requirement to prove that it is required does not make an awful lot of sense, because it suggests that a third party exists to whom it should be proved. No such party exists and no such party is proposed in the amendment.
Amendment No. 63 would limit the effect of clause 51(3) to cases in which the Secretary of State has determined that land within the Crown estate is needed for, or in connection with, the construction of Crossrail. Under the Bill, it would be for the Crown Estate Commissioners to be satisfied that part of the Crown estate was needed for, or in connection with, Crossrail. For the purposes of the provision, we think that it is right that that approach should be maintained and that it is the Crown Estate Commissioners who should take a view. I hope that that has clarified things for the hon. Gentleman and that he will consider withdrawing his amendment.

Mark Field: As the constituency Member for Hyde park, among other royal parks and landmarks of this great city, I should like to confirm what the Minister said. There was extensive consultation on the building of the new site at the edge of Hyde park, close to the border with Bayswater road. A number of concerns were raised by my constituents, many of whom voiced ongoing concern about the increasing commercialisation of Hyde park. The issue was used as yet another cause cÃ(c)lÃ¨bre, but it is important none the less.
I support the amendments tabled by my hon. Friend the Member for Wimbledon. It does not strike me that “other relevant...parties” in the context of this issue are an extensive group of bodies. There is a well regarded list of amenity societies and residents associations in central London—I am sure the same applies to any other part of the UK covered by the measure—and the provision would apply to Friends of Hyde Park and Kensington Gardens, and perhaps to the Marylebone Association and the South East Bayswater Residents Association. It would therefore apply to a very small and defined group. Westminster city council gives status to certain residents groups for the very purpose of their being consulted before planning changes are made, and they have locus standi in such matters. I do not expect that to be a particular problem.

Tom Harris: I urge the hon. Gentleman to use his legal background. believe he trained as a solicitor—I am sorry about that—so does he accept that the catch-all phrase,
“any other relevant interested parties”,
suggests a level of ambiguity that is not helpful? He is right that there is a very specific list of organisations that I am sure would be appropriate, but the proposal does not necessarily point the way to those people.

Mark Field: I am happy to assist the Minister by suggesting that there must be something in the channel tunnel rail legislation along those lines. The world did not become a much worse place when I ceased to be a lawyer. Some of my constituents might argue that the same will be said if I cease to be a parliamentarian before too long, but I sincerely have no such intention in mind.
I accept what the Minister said. We need clarity, and I am not suggesting that the proposal is 100 per cent. ideal. However, it does make an important point about Crown estate land. The royal parks are very close to the hearts of countless millions of people—many of them are constituents of mine, but many of them are not—who value the wonderful amenity they provide. I would point out to the Committee that there are many royal parks outside central London, and it is with that in mind that we tried to target a particular concern.
I do not think that there is any likelihood of the royal parks soon leaving the hands of the Department for Culture, Media and Sport. It is important to remember that in relation to compulsory purchase, particularly in central London, large tracts of Crown estate land are outside the scope of the Bill unless we protect them individually. I hope that the Minister has taken account of what we have said, because it is an important point. It would be a crying shame if, given the importance of much Crown estate land throughout the country, we bypassed the interests of residents and amenity groups in the vicinity by not giving credence to their concerns. It would be perverse in many ways if the Secretary of State had cartÃ(c) blanchÃ(c) to develop those areas, which are regarded by many people almost as common land, given that we rightly have all the safeguards in place for the compulsory purchase of privately owned land.

Stephen Hammond: I thank my hon. Friend for that valuable contribution—not least the clarification with regard to his own constituency and the shaft at Hyde park, for which there might be relevant interested parties—as it offered a clear indication of what “relevant interested parties” might be. I am disappointed that the Minister will not accept that the term “relevant and interested parties”, while it may cause minor ambiguity, would not give cartÃ(c) blanchÃ(c) for interest groups with no particular local or relevant interest—they would be ruled out. The amendment makes it quite clear which groups would be relevant.
As the Minister rightly pointed out, the thrust of a number of our amendments has been concern to ensure appropriate consultation. We are worried that there has not been enough consultation with outside parties throughout.
The other issue is the limiting of discretionary powers. I hear the Minister’s points, but I hope that he will think carefully about whether there is some suitable wording that he could accept and that we could consider. However, I do not wish to press the Committee and I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 51 ordered to stand part of the Bill.

Clause 52 ordered to stand part of the Bill.

Clause 53

Compensation for injurious affection

Stephen Hammond: I beg to move amendment No. 65, in clause 53, page 32, line 27, leave out ‘nominated undertaker’ and insert ‘Secretary of State’.
The clause is probably the shortest in the Bill, but it is significant. I return to the issue of compensation, which we have discussed more than once in Committee. The clause provides that section 10(1) of the Compulsory Purchase Act 1965 will apply in respect of land used for or in connection with the construction of Crossrail. That section deals with those claiming
“compensation in respect of any land, or any interest in land, which has been taken for or injuriously affected by the execution of the works, and for which the acquiring authority have not made satisfaction”.
There is, however, a small but significant alteration to the wording of the 1965 Act—the substitution of “nominated undertaker” for “the acquiring authority”. If we do not do that, the Bill will effectively muddy what is already the grey area of the respective duties and responsibilities of the Secretary of State and the nominated undertaker.
The Committee might recall that when we dealt with clause 6 on compulsory purchase, I tabled an amendment that would have given the nominated undertaker, as opposed to the Secretary of State, the powers to purchase compulsorily. The Minister said that he was tempted by my amendment, but not quite enough, and it was therefore withdrawn. It is clear in the clause that the Secretary of State alone is responsible for the compulsory purchase of land. However, on the question of compensation, it appears that, although the Secretary of State will have compulsorily purchased the land and will be the acquiring authority, the responsibility for compensation now passes to the nominated undertaker.
To make the clause work, therefore, we need to insert the words “Secretary of State” rather than “nominated undertaker”, as outlined in the amendment. Otherwise, we will have an odd perversity, which is that the Secretary of State will have compulsorily acquired the land, yet the nominated undertaker—who may or may not be the Secretary of State, as we discovered previously—will pay out the compensation. That is very strange.
If a landowner’s land were seized or compulsorily purchased by one person, it would seem strange if he had to seek compensation from another. If, as is the case in clause 6, we make the Secretary of State the person who compulsorily acquires the land, it seems perfectly consistent that that Secretary of State must also take on the duties and responsibilities associated with the purchase. Therefore, my amendment would make the clause consistent with other clauses by taking out the words “nominated undertaker” and replacing them with “Secretary of State”.

Tom Harris: On this occasion, I am not even tempted to support the amendment, and I can explain why. Clause 53 is a technical provision that arises from the fact that, although under the Bill the power to acquire land compulsorily for Crossrail is conferred on the Secretary of State, as the hon. Gentleman rightly says, the power to carry out works on that land is conferred on the nominated undertaker. Section 10 of the 1965 Act gives a right to compensation in certain cases where, although landowners do not have particular land that they own compulsorily acquired from them, they none the less have rights associated with their land adversely affected by things done by the undertaker in constructing works on neighbouring land that has been acquired from someone else.
The purpose of clause 53 is to reflect the division of responsibilities made in the Bill so that, in such cases, it is made absolutely clear that the nominated undertaker pays the compensation under section 10 of the 1965 Act, rather than the Secretary of State, simply because of the practical reason that the actions of the nominated undertaker, in carrying out work on neighbouring land, have given rise to the right of compensation.
In this case, it is not the purchase of the land that has given rise to the right of compensation, but the “injurious affection”, as it is described in the clause. The clause does not change the cases where compensation arises, or the amount of compensation payable. It is concerned only with who will pay, as a consequence of the particular division of responsibilities in the Bill.
The amendment would negatively affect the clause by providing for the Secretary of State to pay the compensation. For that reason alone, I cannot support the amendment. I hope that the hon. Gentleman understands my point and withdraws the amendment.

Stephen Hammond: I certainly understand the Minister’s point. Effectively, he is saying that the actions that occur on the land after it has been compulsorily acquired attract compensation, not the physical act of compulsory purchase itself. However, I am not quite sure that I follow his point that the amendment would negatively affect the Secretary of State. Can he clarify that?

Tom Harris: To clarify, the clause refers to section 10(1) of the 1965 Act. I am not accusing the Secretary of State of carrying out any injurious affection on anyone. My point is that the nominated undertaker will carry out the work. Therefore, there is a clear division of responsibility. The Secretary of State purchases the land, and there are compensation arrangements in place for that purchase, separate from the clause. The nominated undertaker, however, will be responsible for carrying out any work that may be injurious to the private landowner, so it does not make sense for the Secretary of State to pay compensation for the purchase and the work that is carried out.

Stephen Hammond: I thank the Minister for that very full explanation, and the matter is now perfectly clear. With your permission, Lady Winterton, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Susan Kramer: In many senses, the clause represents a huge lost opportunity. When it was proposed that Crossrail might come down into my neck of the woods, properties along the route under discussion immediately lost about 25 per cent. of their value. The proposal was not particularly serious and it disappeared in a matter of months, but I did have extensive conversations with Crossrail’s management about a property protection scheme to ensure that proper compensation was paid to people whose property was affected. In cases of direct compulsory purchase, it was well understood that the needs of the property owner would be satisfied, but the clause talks about others whose property is impacted by the scheme.
Crossrail’s management was very positive about the property protection scheme that we discussed. It had been piloted by the central railway project, which never happened, although I should declare that I had an interest in it. Much of Crossrail’s management was familiar with the scheme, which would have given anyone who believed that their property had been affected the option of requiring it to be compulsorily purchased at the point of construction at what would have been the full market value without the affliction.
In effect, the scheme was structured like an insurance scheme, in that it would have remained attached to the project and been exercised only at the point of construction. The money would not have been drawn down, and the option would have attached to the sale of the property so that people could have sold freely, knowing that they were selling on protection to whoever purchased their property from them. The matter would finally have resolved itself during the construction phase.
We have a serious problem with major projects such as Crossrail, which have an impact on people who must sell their property because they need the money as part of their retirement plan or for some other purpose. The existing legislation is not adequate to cover such circumstances, and I hope that the Minister will use the opportunity afforded by the Bill to set out how such people can be protected appropriately.

Peter Soulsby: I understand the hon. Lady’s concern about property owners affected by major projects such as Crossrail, but I remind the Committee yet again that it is for that reason that Parliament has the hybrid Bill procedure, which is intended to protect private interests during the promotion of such public Bills. We go through the process of specially establishing a Select Committee so that we can look at exactly the concerns she expressed.

Susan Kramer: Does the hon. Gentleman accept that, even with the hybrid Bill process, there is often a long delay and that people selling property in the interim are inevitably injured? Does he also accept that one advantage of a property protection scheme is that the market identifies who has suffered because the price that they are offered for their property is different from that offered for a comparable property that is not afflicted? Many issues of contention regarding which property is or is not affected therefore disappear because the market establishes the facts.

Peter Soulsby: Again, I entirely understand the hon. Lady’s point, but the hybrid Bill process allows for precisely the concerns that she has expressed. It enables those who fear that their land or property might be adversely affected by the Bill and the scheme that it enables to petition against the Bill in the Commons—the stage that we have gone through—and the Lords. I assure her that that the hybrid Bill Committee heard many petitions on matters related to compensation. Many people expressed both their particular and general concern about the likely effects of the Bill on their neighbourhood on behalf of those who lived around them. We took careful note of the concerns that were expressed and, in some cases, made recommendations to the promoters and the Government on ways in which those interests could be given special protection. We are grateful to the promoters for the attention that they paid to those concerns and the amendments that they made to deal with specific situations and more generally as a result of those representations.
I certainly think that the other members of the Select Committee all felt at the end of the process that those who had had concerns similar to those expressed today by the hon. Member for Richmond Park were heard appropriately and had the opportunity for their concerns to be taken into account. In the overwhelming number of cases, those people felt that their concerns had been adequately satisfied and their interests appropriately protected. I feel that her concern about what she described as a missed opportunity in the clause is misplaced. Those concerns have already been taken into account and those with lingering concerns will have the opportunity to petition again when the Bill goes through the Lords and to ensure that their concerns are taken into account if they have not yet been so.

Brian Binley: As the other member of the Committee who was also a member of the hybrid Bill Committee, I support what has just been said. The hybrid Bill Committee concerned itself at great length with the whole issue of compensation, because it seemed to us that the promoters were shoving through a project, rightly so from many people’s perspectives, but that was not the fault of the people who would be affected. Therefore, we fought long and hard on their behalf and gained some considerable advantages for them as a result.
My fear is that the amendment would be immensely misplaced in relation to the work that we did. I think that the rights are already protected in the Bill and I am well satisfied that the compensation code would be properly applied. Additional rights were given as a result of the work of the hybrid Bill Committee and it therefore seems that, not only is the amendment pretty pointless, it could also be harmful.

Tom Harris: I thank hon. Members for their contributions on the stand part debate. The hon. Member for Richmond Park made some important points, and I know that she is concerned about the general problem of blight as it affects many private property owners. Of course, that problem has impeded any number of civil engineering and construction projects throughout the country and it continues to trouble many private property owners along the routes of roads and other potential civil engineering projects.
I disagree that the clause is a missed opportunity. If I understand the comments of the hon. Member for Richmond Park correctly, she is looking for a new, general purpose procedure that would apply not only to Crossrail, but to other civil engineering projects. Of course, that is not part of the purpose of the Bill and the clause is somewhat narrower than the scope of her points, but they were well made and I am sure she will want to continue that campaign elsewhere.
I echo the words of my hon. Friend the Member for Leicester, South and those of the hon. Member for Northampton, South. It is invaluable to have two previous members of the Select Committee, as they bring a certain perspective that none of the rest of us have or would have wanted, given the length of time that they served on that Committee. Their remarks have always contributed to positive debate and I am grateful to them both.
I agree with the points that my hon. Friend the Member for Leicester, South made about the opportunity for petitioners to speak to the Committee, raise the issues with which they had concerns and have them addressed. A discretionary hardship policy exists that allows qualifying landowners to require the purchase of their property. Of course, it is discretionary and will not meet all the demands of the hon. Member for Richmond Park. However, now that we have explored the breadth of this modest and short clause, I commend it to the Committee.

Question put and agreed to.

Clause 53 ordered to stand part of the Bill.

Clause 54

Compensation for water abstraction

Question proposed, That the clause stand part of the Bill.

Stephen Hammond: Before we move on, I want some clarification from the Minister. The clause disapplies the provisions of the Water Resources Act 1991, which prohibits any form of water abstraction if it has injurious effects on another person. I understand that water abstraction might be a necessary part of the works performed to build Crossrail, but there are some serious implications that I want to consider with the Minister. Have the deposited plans identified any scenarios in which water will need to be abstracted in a way that might cause loss or damage? As I understand it, the clause is one of the few that has no precedent in the Channel Tunnel Rail Link Act 1996. The Minister wants extra new powers that have no precedent. I am sure that they will be necessary because of the uniqueness of the Crossrail project, but will he tell us why the Secretary of State will need those plans and where on the identified route they are likely to apply?

Tom Harris: As far as I know, the hon. Gentleman is correct that the measure is unprecedented in the Channel Tunnel Rail Link Act. The Bill is not intended as a carbon copy of that Act and many of the clauses in the Bill will be adopted by future Governments to inform the construction of their policy.
Clause 54(1) disapplies the provisions of the Water Resources Act 1991 that would otherwise impose an absolute prohibition on abstracting water if that causes loss or damage to another person. Such a restriction could well prevent or delay Crossrail works from being constructed. Clause 54(2) provides that where water abstraction has caused loss or damage, the person suffering the loss or damage must be compensated. The overall effect of the clause is that the duty to avoid damage by water abstraction creates the possibility of compensation for damage but not the possibility of a court injunction. The practical protection for property owners arises from the requirement that the Environment Agency pre-approve abstraction, for which the hon. Gentleman can refer to paragraph 3 of part 3 of schedule 16.
The hon. Gentleman asked whether any work had been done that would suggest that water abstraction could be to the detriment of the construction of Crossrail. Once again, because we are at such an early stage without even having started construction, the purpose of those who drafted the Bill was to try to foresee all circumstances in the hope that the powers in the clause would not ever have to be used. Once again, going back to the cost and importance of the project, it is only fair that we should adopt a belt-and-braces attitude.

Question put and agreed to.

Clause 54 ordered to stand part of the Bill.

Clause 55 ordered to stand part of the Bill.

Clause 56

Application of Act to extensions

Question proposed, That the clause stand part of the Bill.

Stephen Hammond: In the same spirit as my comments on clause 54, I want to clarify some points with the Minister. Clause 56 effectively allows most of the provisions in the Bill to apply to any proposed extension of the Crossrail network. Does that mean any extension that is carried out under an order under the Transport and Works Act 1992? I can see that if the network is expanded, it should receive the same statutory support as planned under the network. However, unless I have read the clause completely wrongly, would not an extension to the Crossrail network that occurred or was proposed in the construction period re-hybridise the Bill? The extension would then be subject to the same scrutiny that the hon. Member for Leicester, South has indicated he experienced and enjoyed.

Tom Harris: I strongly suspect that the hon. Gentleman has read the clause completely wrongly, but I shall try to explain. Clause 56 allows any TWA order that relates to a proposed extension of Crossrail or to provision of a facility connected with Crossrail to apply to any provision of the Bill, with any modifications necessary to the order, or to provide that any provision of the Bill should have effect as if the extension were part of Crossrail.
Let me explain the purpose of Clause 56. As the hon. Gentleman knows from earlier debates, the Bill establishes a bespoke regime for Crossrail. It modifies and disapplies various pieces of legislation, and replaces them with a tailor-made regime that is based heavily on that created by the Channel Tunnel Rail Link Act 1996. Indeed, he will recall from our debate last week that the Bill creates a bespoke planning and railway regulatory regime for Crossrail.
If a TWA order is subsequently sought for an extension to Crossrail—for example, to Reading or Ebbsfleet—or for a new Crossrail facility such as a new station, the TWA order cannot necessarily apply the same regime to the works as is established by the Bill. The reason is that, as a form of delegated legislation, TWA orders are limited in their ability to modify the application of legislation.

Stephen Hammond: For the purposes of clarity, is the Minister saying that a TWA order cannot extend Crossrail?

Tom Harris: TWA orders have their own scrutiny mechanism, which would apply to any future extension. Any future extension would have to be considered separately, although not as part of a hybrid Bill.

Stephen Hammond: I am following the Minister’s logic, but I think that, in fact, I read the clause correctly, and I still have not had the answer to my question. The question was whether any route extension to Crossrail can be made without it being subject to hybrid Bill provisions, such that it does not require the same scrutiny—nor present the same possibility of petitioning—as was the case for the original route. If that is the correct position, it is a curious one.

Tom Harris: It is my exact understanding that any future proposal to extend Crossrail—albeit there is no such proposal at present—could be achieved through a TWA order rather than through the hybrid Bill process. Perhaps I could continue to the end of my remarks, and if the hon. Gentleman then has further questions I shall be happy to answer them.
The clause would allow any TWA order to make the necessary provision to ensure that any extension or new facility was subject to the same regime as the Crossrail scheme covered by the Bill. The Government believe that that makes perfect sense. It would be confusing and unhelpful if one regime applied to parts of Crossrail and another applied to others. Having said that, there are safeguards. Certain provisions of the Bill that deal with extension of compulsory purchase powers, listed buildings, buildings in conservation areas and ancient monuments are excluded from such application. Any TWA order that sought to apply the Crossrail Bill regime would of course follow the normal procedures for such orders. Those affected would have the opportunity to object to any aspects of the Bill regime that the order proposed should apply, and have their concerns heard by an independent inspector as part of the TWA order process.
I had intended to conclude my remarks on the amendment at that point, by if the hon. Gentleman has questions, I shall try my best to answer them.

Stephen Hammond: I do no think that I have any further supplementary questions, but the Minister has made some very interesting observations that have expanded on the information contained in the explanatory notes. Given that, and given my understanding of the way in which his remarks tie up with the explanatory notes, we shall certainly wish to the clause revisit on report.

Tom Harris: For clarification, a TWA order can extend Crossrail. However, without the provisions in this clause, the same statutory regime cannot apply. That is why we need the clause.

Susan Kramer: I thank the Minister for that response, but we are beginning to descend into complete confusion. Is what he is describing a sort of TWA-plus, so that it essentially builds up to the level of protection of the hybrid Bill for the extension, or is he saying that this will be a classic TWA with no more protection than any other project?

Tom Harris: I am not sure whether I can add to the comments that I have already made. The situation remains that a TWA order can extend Crossrail. The hon. Lady mentioned safeguarding. The decision to safeguard, for example, the route to Reading is on my desk, and I will be considering that in the very near future. That would simply keep options open, so that in the future the Government could choose, through a TWA order, to extend Crossrail to Reading. Once again, I must emphasise that that is not what the Government propose at the moment. I talked merely about safeguarding. However, that is the process that would have to be gone through if Crossrail were to be extended either westwards to Reading or south to Ebbsfleet.

Question put and agreed to.

Clause 56 ordered to stand part of the Bill.

Clause 57 ordered to stand part of the Bill.

Schedule 15

Reinstatement of discontinued facilities

Stephen Hammond: I beg to move amendment No. 67, in schedule 15, page 213, line 39, at end insert—
‘( ) Where the site on which the facility was situated prior to discontinuation is available for re-use, the facility should be reinstated under sub-paragraph (1) for the original purpose of the facility and on this site.
( ) Where the site on which the facility was situated prior to discontinuation is not available for re-use, the facility should be reinstated under sub-paragraph (1) on a site as close as possible to this site.’.
Schedule 15 is obviously important, in that it deals with the steps that must be taken to reinstate facilities that have necessarily been taken out of use as a result of the construction of Crossrail. Paragraph 1(4) provides that the reinstatement
“need not be on the site where the facilities were situated prior to discontinuation.”
Of course, in a perfect world, once Crossrail was up and running, we would be able to return buildings and facilities affected by construction to their original state and, in most cases, to their original location and no one would know that it had been a construction site before. This is not a perfect world and I acknowledge that in a number of cases it might not be possible to do that. However, as the Bill stands, there is no obligation on the nominated undertaker even to try to reinstate the disused facilities in their original location.
My amendment is designed to address that gap in the Bill. If the amendment were to prevail, the nominated undertaker would have a duty to reinstate the facility on its original site if it were possible physically to do that. If it were found to be physically impossible, he would have to reinstate the facility as near to the original site as he could. That seems a logical and reasonable way to ensure that the damage caused by Crossrail construction is, to as great an extent as possible, reversed once the construction work is done and reversed in such a way that the original facility is put back in its original state. I look forward to the Minister commenting on the amendment.

Tom Harris: As the hon. Gentleman said, the amendment is perfectly reasonable and sensible. Nevertheless, I ask my colleagues to resist it if it is pressed to a vote, because it is not appropriate to this clause. Schedule 15 relates to the reinstatement of facilities that have been discontinued as a result of the construction of Crossrail, and provides for conditions to be placed on the deemed planning permission granted by the Bill for such reinstatement if it has been environmentally assessed. That reinstatement may be on the original site or elsewhere within Bill limits, which is to say that it must be within the limits set out in the Bill for land to be acquired or used. For example, there is a concrete batching plant at Royal Oak that falls within an area that we need for a worksite. We are in the process of negotiating an agreement with the owners of the plant regarding the provision of a replacement facility. The amendment would mean that any such replacement facility would have to be placed on, or as close as possible to, the original facility.
Proximity to the original site is not the only, or even the most important, factor when deciding on the most appropriate site for reinstated facilities. Generally speaking, Crossrail works will have altered the site and the former location of a facility may no longer be the best one. When deciding on the best location for a reinstated facility, there may be a number of factors to balance, including the operational needs of the business, the operational needs of Crossrail and the impact on neighbouring sites. Depending on the circumstances of the case, it is possible that all of those factors might point towards relocating the facility. The availability of sufficient land within the limits set out in the Bill for land to be acquired or used, may also be a consideration.
That said, for facilities that we intend to reinstate, we currently expect to put the replacement facility very close to the site of the original, where practicable. For instance, there is a Travellers’ site in Tower Hamlets that will need to be used for a worksite. To meet the desires of the Travellers and the local authority, we plan to relocate them to a site adjacent to the existing one. I believe that it overlaps the existing site. We do not think that it would be appropriate always to constrain the position of a new site in the manner proposed. It would not necessarily result in a location that pleased anyone. Local amenity considerations regarding the site of replacement facilities could mean that it would be wrong, in planning terms, to reinstate near an existing site.
There are a range of considerations that the Secretary of State might take into account in the public interest. I should stress, however, that the Bill provides deemed planning permission for reinstated works only if an appropriate environmental assessment has been carried out and reported in an environmental statement accompanying Bill. The amendment is a touch too prescriptive and represents some form of over-regulation. I do not think that it is appropriate to this part of the Bill, although I accept that the intention behind the amendment is good.

Peter Soulsby: I will not harp on for too long about what was discussed at the hybrid Bill Committee, but I will back up what the Minister has said. At that Committee, a number of the representations were made about those who will have to be relocated temporarily and about whether it was appropriate for them to be reinstated on the original site or whether some alternatives were to be found. Those who were to be affected had an opportunity to petition and many took it.
To accept the amendment would be too prescriptive. The solutions that were found were in some cases quite creative, but in almost all cases meant that the petitioners whose land was to be affected would find themselves in a better position than they had been in.
The Minister mentioned one example of a concrete batching plant. That was a case that we spent a considerable time on and came to some particular solutions that were satisfactory to all parties concerned. I understand the intention behind the clause, but suggest that it is unnecessary, given the consideration at the hybrid Bill Committee and that which will be given in another place.

Stephen Hammond: I listened to the hon. Gentleman and noticed that when the words “concrete batching plant” crossed the Minister’s lips, there was a facial contortion. I can only assume that that case took up rather a long time at the Select Committee. I am glad that they came to some concrete solutions.
I am glad that the Minister accepts that we are on to something and I take his point that there are a range of options beyond those that I specified in the amendment. As the clause is drafted, there is no firm obligation to restore sites as close as possible to the original site. I take the Minister’s point that it will be done as much as is practically possible in as many cases as possible. I take his point that the amendment may be worded too tightly. We may wish to redraft the amendments before Report and I therefore beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Stephen Hammond: I beg to move amendment No. 68, in schedule 15, page 214, line 20, leave out ‘he thinks’ and insert ‘might reasonably be considered’.
This amendment and the following one are relatively small modifications to the wording of paragraph 2 of the schedule, which deals with planning permission issues that may arise as a result of the reinstatement of disused facilities.
The amendment simply replaces the words “he thinks” with “might reasonably be considered” in the context of the method used by the Secretary of State to publish any directions relating to deemed planning permission in his report. I will not dwell long on justification of the amendment; the Minister will be able to see the thought process behind it. It implies that rather than just thinking about the matter he might have to undertake some consultation. The small change in the wording would allow the Secretary of State to carry out his or her duties in a way that is responsible, appropriate and seen to have been accountable.

Tom Harris: Amendment No. 68 relates to the requirement to publish any directions given under schedule 15 to condition deemed planning permission for reinstated facilities or to disapply or modify the application of schedule 7 to such works. As the duty to publish is a duty placed on the Secretary of State, she must be the one to decide what is the most appropriate manner to do so. Moreover, I remind the hon. Gentleman that the Secretary of State is under a general duty to act reasonably. Although it is a minor change and in the hon. Gentleman’s view it would not change it a great deal, the amendment does not add very much to the Bill and I ask him to consider withdrawing it.

Stephen Hammond: It is a minor change but its purpose is to ensure that the Secretary of State not only acts in a responsible way but is seen, and proven, to be doing so. That is the thrust of several of our amendments. I am disappointed that the Minister will not accept the minor changes in the wording but it is not worth dividing the Committee on the proposal. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Stephen Hammond: I beg to move amendment No. 69, in schedule 15, page 214, line 23, at end insert ‘and any other relevant interested parties’.
I will not detain the Committee with this amendment, which we wanted to be on the record. Hon. Members will recognise that it is nearly identical to several others we have debated this afternoon and in previous sittings. In order to build and run the Crossrail network the Government and/or the nominated undertaker will need to intrude on private property and existing infrastructure, which is inevitable with a project of this scale. The key thing is to ensure that it is done in a right and proper way.
To keep disruption to a minimum, all affected parties must be kept informed and consulted and that is the motive behind the amendment. When deemed planning permission is provided by means of a direction, the details should be circulated to the owners and occupiers of the land over which permission is given and to anyone else who might be affected. That might incur a little additional work for the Secretary of State but it will ensure that all the appropriate people are made aware of any of the proposed works. I hope that the Minister will be tempted by this minor wording change.

Tom Harris: The hon. Member for Wimbledon started by saying that the amendment was identical to previous amendments. I am about to use arguments against it that are identical to previous arguments.
Schedule 15 already requires copies of the directions to be given to the owners and occupiers of the land to which the deemed planning permission relates, and to the relevant planning authority, as the persons with a clear and identifiable interest. It also requires the Secretary of State to publish the directions, so that they will be available to those who are less directly affected.
Amendment No. 69 would create an unnecessary administrative burden. It would require the Secretary of State to give copies of any directions given under schedule 15 to
“any other relevant interested parties”.
That would place a potentially large burden on the Secretary of State and it could lead to lengthy arguments, perhaps even legal arguments, about whether all “relevant interested parties” have been identified.
The hon. Gentleman is a member of a party that consistently and regularly lectures the Government on over-regulation of industry. I would have thought that, in the interests of deregulation and simplification alone, he would wish to withdraw the amendment.

Stephen Hammond: But of course if we were to listen to and follow the logic of the Minister’s answer, that way dictatorship lies, in that the powers would be invested only and entirely in the autocrat and they would be subject to no scrutiny at all. I am sure that the Minister would not want to confuse the over-regulation by his Government in one area with the under-consultation of his Government in another area. None the less, I have listened to the Minister and I am happy to accept his invitation. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 15 agreed to.

Clause 58 ordered to stand part of the Bill.

Schedule 16

Protective Provisions

Stephen Hammond: I beg to move amendment No. 75, in schedule 16, page 218, line 23, leave out from ‘arbitration’ to end of line 27.

Ann Winterton: With this, it will be convenient to discuss the following amendments: No. 76, in schedule 16, page 225, line 4, leave out from ‘arbitration’ to end of line 8.
No. 77, in schedule 16, page 229, line 33, leave out from ‘arbitration’ to end of line 37.
No. 78, in schedule 16, page 232, line 45, leave out from ‘arbitration’ to end of line 49.
No. 79, in schedule 16, page 236, line 6, leave out from ‘arbitration’ to end of line 10.
No. 80, in schedule 16, page 239, line 46, leave out from ‘arbitration’ to end of line 2 on page 240.

Stephen Hammond: Amendments Nos. 75 to 80 are identical, in that they would make exactly the same adjustment to each of the six parts of schedule 16. The schedule gives protection to various bodies whose work might be affected by the construction and operation of the Crossrail network. It deals, in turn, with highways, utilities, water issues, electronic communication networks, waterways and finally the Port of London Authority. In each case, there is a sub-paragraph that deals with dispute resolution. Disputes will be settled by arbitration if the two parties agree; if the two parties do not agree, then, with the proviso that the dispute is not about money, it will be up to the Secretary of State to appoint someone to find a solution.
I do not want to regurgitate the concern that we have had all the way along about arbitration. All I will say is that, given the fact that there will be a very real relationship between the nominated undertaker and the Secretary of State, we do not want the situation where—we have been through this before—the defendant is trying his own case.
It seems to me that the arbitration process that should be employed should be fair and independent, and the Secretary of State should not intervene in that process. The decision of a third party arbitrator will enjoy the benefits of authority and impartiality. The Secretary of State, however much they believe themselves to have a duty of responsibility, cannot be seen to be independent. Therefore, it should not be the job of the Secretary of State to resolve disputes of this kind.

Tom Harris: Schedule 16 contains protection for various bodies and statutory undertakers whose interests and functions may be affected by the powers of the Bill. In each case, there is provision for determination of disputes, with the nominated undertaker to be referred to arbitration if the parties agree or if the dispute relates to the amount of payment. Otherwise, the dispute is determined by a person appointed by the relevant Secretary of State; that is the Secretary of State for Transport, together with—where it is a different Secretary of State—the Secretary of State who has the responsibility of overseeing the statutory undertaking in question. In other words, for the water industry it would be the Secretary of State for Environment, Food and Rural Affairs, and so on.
The hon. Gentleman’s amendments would require all disputes to be referred to arbitration. May I refer him to the response that I gave in relation to the similar issues in respect of amendments Nos. 26 and 27? Giving the Secretary of State the ability to determine disputes on various matters is well precedented for projects of national significance and follows similar provisions in the Channel Tunnel Rail Link Act 1996. Arbitration can be a time-consuming and costly experience that may not be consistent with the timely implementation of the project.
In this case, however, we have gone beyond the precedent in CTRL in spelling out that disputes are to be determined by a person appointed by the Secretary of State and we have also provided that any disputes about the amount of money payable will be settled by arbitration: such disputes would not hold up implementation of the project in the way that a dispute over approval of plans of the works might do. The statutory undertakers concerned have the additional reassurance that the Secretary of State responsible for them will be one of the Secretaries of State appointing the person to determine the dispute.
The provisions have been discussed with the statutory undertakers concerned and include amendments that have been agreed with them. The Secretary of State has given assurances about how the powers will be exercised. My understanding is that the statutory undertakers are now content with these arrangements and I urge the hon. Gentleman not to seek to impose such a modification on the arrangements when they are not seeking that themselves. I invite him to withdraw his amendment.

Stephen Hammond: As the Minister said, we have had this discussion several times. The Channel Tunnel Rail Link Act has been our precedent on a number of occasions although I think that we have accepted this afternoon that we should not necessarily follow it slavishly.
I listened carefully to the Minister. The latter part of his argument was the most compelling in that he said that he has already undertaken consultation and has already worked with the nominated bodies that might be affected by the clause. They have had the chance to put in their own amendment, which has been accepted. That being so, it would be wrong of me to try to impose something that was not being sought by the people I am seeking to protect and who already feel that they have the protection. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 16 agreed to.

Clause 59

Power to devolve functions of Secretary of State

Question proposed, That the clause stand part of the Bill.

Stephen Hammond: This will be a short contribution, but it is obviously an important clause. It will allow the Secretary of State to devolve some of the powers that she has given herself to other bodies. Certain provisions in this Bill qualify for being liable to be devolved either to the Greater London authority and/or Transport for London. Could the Minister tell us in what circumstances the Secretary of State envisaged delegating the exceptional powers that she has taken and the rationale behind that?

Tom Harris: Clause 59 allows the Secretary of State, by means of an order, to devolve certain provisions of the Bill to the Greater London authority, Transport for London or to both. This power is necessary to allow the flexibility for the Crossrail project to be taken forward by these bodies, if that is in the best interest of delivering the project most efficiently.
To answer the hon. Gentleman’s question directly, he will know that it is intended that the Mayor and TfL will be responsible for the delivery of the project, and the powers in clause 59 might be needed to facilitate their taking the project forward. That said, I have to disappoint him because it is not yet clear which of the powers that are listed in subsection (7) will be devolved to the Mayor and/or TfL or whether the project governance arrangements that have been announced could be better delivered by other means. However, we believe it is right that the Secretary of State should be capable of devolving specific powers in the Bill if that is what is decided should happen.

Stephen Hammond: I note the Minister’s comment that it is not yet clear whether the Government’s provisions in the Bill might be delivered by better means. Does he intend to come to that conclusion before the Bill completes its passage through the House?

Tom Harris: I remain to be corrected, but when I referred to governance I did not mean anything in the Bill. Not every detail of governance is included in the Bill and I would not anticipate having to bring forward amendments to that effect.
To set my general remarks in context, it might help the Committee if I summarise the proposed project governance arrangements. Cross London Rail Links Ltd will continue as a project delivery vehicle for Crossrail. The Department for Transport will remain as a co-sponsor of the project and will form a joint sponsors board with Transport for London to supervise the project. The Department and TfL will execute a series of formal arrangements that will specify how the project will be taken forward. CLRL will become a wholly owned subsidiary of TfL, but with a level of independence needed to focus solely on delivery of the Crossrail project for its joint clients.
CLRL will have a board dominated by independent, non-executive directors chosen for their skills in delivering so-called mega-projects—not a phrase that I am particularly comfortable with— and free to appoint a world-class team at market rates. The written statement issued by my right hon. Friend the Secretary of State for Transport that accompanied the publication of the heads of terms provides more detail about how the Department and the Mayor, as co-sponsors, will take the project forward. I hope that the explanation that I have given and the material with which I supplied each member of the Committee yesterday persuades hon. Members to accept the clause.

Question put and agreed to.

Clause 59 ordered to stand part of the Bill.

Clause 60

Correction of deposited plans

Stephen Hammond: I beg to move amendment No. 71, in clause 60, page 36, line 14, at end insert—
‘( ) The Secretary of State, upon making an application under subsection (1), shall give notice that he has made such an application to all those affected by such an application.
( ) The Secretary of State, upon receiving the decision of the justices under subsection (2), shall inform all those affected by the decision as to the outcome of the application made under subsection (1).’.
The clause sets out what will happen if a mistake is discovered in the deposited plans, or in the grandly named book of reference. The Secretary of State may apply to two suitable justices—however widely or tightly that may be defined—in order to correct any inaccuracies identified. A copy of the justices’s decision will be deposited in the House of Commons and in the offices of the relevant local authorities.
That is fine, but I do not think that it goes far enough. I fear that there may well be a situation whereby people affected by mistakes, and therefore changes to the deposited plans, are likely to remain blissfully unaware of them unless they are frequent visitors either to the Private Bill Office here or to the offices of their local authority.
To avoid such a circumstance arising, it seems only right that, if the Secretary of State is applying to the justices for the mistake to be remedied, those who will be affected by the change when the Secretary of State refers that case to the justices and sees their decision should be informed. That is what the amendment would do. It would ensure that those who are affected by the changes are informed that the changes are about to take place.

Tom Harris: The clause sets out the procedure for the correction of the deposited plans or the book of reference should any errors be found in the description of the land or the ownership or occupation of the land. The hon. Gentleman’s amendment, if approved, would require the Secretary of State, before making an application to two justices of the peace, to amend the deposited plans or book of reference deposited with the Bill to notify first those affected by the application. It would also require the Secretary of State to notify the same people of the justices’s decision.
I understand the intent behind the amendment. Those directly affected by any proposed amendment to the plans or book of reference should clearly be aware that such a change is being sought. However, I point out that that is already provided for in subsection (1), which requires the Secretary of State to give not less than 10 days’ notice to the owners and occupiers of the land. That is the subject of the proposed amendment, and, once an application has been determined and a certificate issued, copies of the certificate are lodged in Parliament and with the relevant local authority. I assure the hon. Gentleman, therefore, that the plans and book of reference cannot be amended in secret, without those most directly affected knowing about it. I had hoped that those provisions would not prove contentious, as similar provisions are common in private Acts for railways.

Peter Soulsby: Give us an example.

Tom Harris: I understand that the clause is modelled on a similar clause in the Channel Tunnel Rail Link Act 1996.

Stephen Hammond: I thought that the Minister, for the sake of novelty, was going to use the 1895 Act.

Tom Harris: The hon. Gentleman is just showing off now. With the explanation that I have given, I hope that he will feel able to withdraw his amendment.

Stephen Hammond: I think I will feel able to do that, but there was never any suggestion that either the hearing or the plans were to be conducted in secret. I take what subsection (1) says, but the amendment would add to that, because the clause implies that notice be given to the owners of the land that will be affected by the change. However, other people might also be affected. Also, as I understand it, the clause does not necessarily require that those people be informed of the decision, only that the decision be placed in the House of Commons or in local area offices.

Tom Harris: The hon. Gentleman refers to people, other than the owners of the property, who may be affected. He has not submitted an amendment to that effect, but if he had, is there not a danger that this would be a nebulous and never-ending process if every person who believed that they had been affected would have to be notified?

Stephen Hammond: Actually, the amendment states “all those affected”, so there is no question of it being nebulous or open-ended. There is a clear definition and I have tried in the amendment to find some way of defining who should be notified. I accept that “all those affected” might be a wide proposal and I have listened to the Minister and think that he is clearly trying to reassure me that my fears are ungrounded given what is already in the Bill. I, therefore, beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 60 ordered to stand part of the Bill.

Clause 61

Service of documents

Stephen Hammond: I beg to move amendment No. 72, in clause 61, page 36, line 33, after ‘by’, insert ‘registered’.

Ann Winterton: With this it will be convenient to discuss amendment No. 73, in clause 61, page 37, line 3, after ‘office’, insert
‘or the office of its legal representative’.

Stephen Hammond: Amendment No. 72 is very simple and needs little explanation. It would merely require documents that are to be served under the Crossrail Act to be sent by registered post. As the Committee will be aware, a registered item of mail is recorded in a register when it moves from a local post office, through the sorting office and on to its final destination. It incurs a small extra cost and provides the added comfort that the item’s location can be tracked through the postal system. Those of us who have just experienced the circumstances of October, including many of my constituents, will understand that, if the document is important, that protection would be not only relevant, but appropriate. It is a small measure that would ensure that the Secretary of State’s documents get to the people concerned, and the excuse that mail got lost in the post would not apply. I therefore hope that the amendment will find the Minister’s favour.
I will not spend long talking about amendment No. 73, whose purpose is to fill a small gap in the clause. The clause states that, for non-UK businesses, documents will be delivered to the company’s
“principal office within the United Kingdom.”
All I am suggesting is that there may be a situation in which the company in question does not have an office in this country. The amendment provides that the documents by delivered to the company’s legal representative in the UK and fills a minor gap. I will not press amendment No. 73 but I am interested to see why the Minister feels unable to accept amendment No. 72, if indeed that is his desire.

Tom Harris: The clause deals with the service of documents under the Bill. Its purpose is to set out how notices under the Bill should be served. Amendment No. 72 would require that any document served under the Bill by way of the postal system should be delivered by registered post. It is important to realise that that would apply to any person serving a notice, whether they were the Secretary of State, the nominated undertaker or any other member of the public serving a counter-notice. A number of provisions provide for other parties to serve notice on the nominated undertaker, and the amendment would require such notices to be served by registered post. Using some method of registered post might be sensible in some cases. It is in the interest of the person serving the notice to ensure that it reaches the intended recipient, as the person serving the notice would be disadvantaged if, in the event of a dispute, they could not later demonstrate that the notice had been properly served. The hon. Gentleman was right to point that out.
Registered post is more expensive than regular post and cost may be a consideration in some cases—presumably not for the Secretary of State, but possibly for private individuals. The person concerned should decide how they wish to proceed, bearing in mind that it may later be a matter of dispute before a court or other judicial body.
I am instinctively opposed to any measure that might incur the accusation of ushering in a nanny state, and I would have thought that a legislator prescribing the method of post that an individual should use to serve any particular notice is perilously close to territory that might lead the Daily Mail to take issue. That does not concern me, but it might concern Opposition Members. 
Amendment No. 73 would allow documents to be served on legal representatives rather than a business partnership. However, clause 61(4) already allows the person on whom a notice would otherwise be served to specify an alternative address to which documents should be served. That allows a person to ask for notices to be served to the office of the legal representative if they so wish. I therefore consider the amendments unnecessary, and I hope that the hon. Gentleman will consider withdrawing the amendment.

Stephen Hammond: It is quite amusing for Opposition Members to hear strictures about the nanny state. If the Minister follows that through, I look forward to his joining us more often in the Lobbies to vote against the provisions proposed by his Government. I think that the Daily Mail would rather like the amendment. It gives protection to the small person and allows them to know with absolute certainty that what is being served will reach its destination.

Tom Harris: Does the hon. Gentleman believe that any member of the public who is in a position where he or she has to serve notice in such a way will not understand what registered post is or the postal options available? Does he believe that we need to put instructions in the Bill about which envelope to use?

Stephen Hammond: I know that most of my constituents will not have that problem, so I will not be tempted down that route. We have all seen problems with the postal system and we have all lost important documents. I certainly have lost important documents in the postal system with no method of tracking them. I do not see that this minor technical change does anything other than add to the Bill. I am not tempted to withdraw the amendment and want to test the Committee’s will and press it to a vote.

Question put, That the amendment be made:—

The Committee divided: Ayes 5, Noes 8.

Question accordingly negatived.

Clause 61 ordered to stand part of the Bill.

Clause 62

Arbitration

Stephen Hammond: I beg to move amendment No. 74, in clause 62, page 37, line 39, leave out subsection (5).
The clause is important because it deals with the process of arbitration and, in essence, it is a strong clause although hon. Members will have detected from my remarks throughout the Committee that I would like it to apply more widely.
The amendment would omit subsection (5) as I fail to see what it would add. It allows the Secretaries of State for Transport and for Communities and Local Government to combine to issue rules about the procedures that govern the process of arbitration.
The system for appointing an arbitrator is already set out clearly in the clause and I would have thought that the detailed rules of engagement should thereafter should be left to the arbitrator. If the Government intervene, it could be problematic; one of the parties to the dispute, namely the nominated undertaker, is an appointee of the Secretary of State and the others could be the Secretaries of State. How would the other party react if they knew that the adversary was writing the rule book?
I invite the Minister to clarify exactly why he thinks the Secretaries of State need the powers that I believe could, yet again, jeopardise the independence of the arbitration process, which other than that seems to be robust and appropriate.

Tom Harris: The Bill contains provisions for various matters to be referred to arbitration. For example, if the parties agree, disputes with highway authorities under schedule 3 and with various statutory undertakers under schedule 16 can be referred to arbitration. Subsection (5) allows the Secretaries of State for Communities and Local Government and for Transport acting jointly to make the rules governing such arbitration. The hon. Gentleman’s amendment would remove that power.
Subsection (5) follows a similar provision to the Channel Tunnel Rail Link Act 1996. It address the possibility that it may be necessary to have special tailor-made provisions to address the settling of disputes arising under a scheme of the complexity, size and importance of the Crossrail project. Two Secretaries of State will have responsibility for that, rather than just the Secretary of State for Transport, and they will have to ensure that such rules are consistent with the principles of natural justice.
I am not saying that it will not be necessary to make such rules; however, it is important that the Secretaries of State should have the power to do so should it be considered that the need arises. The amendment would remove the power of the Secretaries of State for Communities and Local Government and for Transport to make rules about procedure in relation to arbitration under the Bill. The clause was applied successfully to former Conservative Secretaries of State and it worked extremely well under the Channel Tunnel Rail Link Act 1996. I therefore hope that the hon. Gentleman will seek leave to withdraw the amendment.

Mark Field: I cannot think of any circumstances in which the clause could be invoked. Surely, the reality is that if there is arbitration it is because both parties agree to it. If the procedure is in some sense up in the air, and it has to be enforced by Secretaries of State against the will of one or perhaps even both parties, that runs wholly counter to the notion of what arbitration is, and should, do. Arbitration is about parties getting together on the basis that they agree not only on its application but presumably on the procedure for it. That is why my hon. Friend the Member for Wimbledon thinks that subsection (5) is redundant, and I agree with him. Nothing that the Minister has said has convinced us otherwise. One hopes that the provision will never be invoked, and I suspect that it never will be, because if such a dispute began the parties would not wish to go to arbitration, still less accept an arbitration procedure that was pushed upon them by Secretaries of State.

Tom Harris: May I clarify the position? The clause does not propose that the Secretary of State for Communities and Local Government and the Secretary of State for Transport should determine the result of arbitration; it is about those two Secretaries of State agreeing a procedure for arbitration.

Stephen Hammond: That goes to the nub of what we have discussed several times in our deliberations. The Secretary of State wants to take powers that will enable them to become party to a dispute and seek arbitration, yet at the same time try to affect the arbitration process or even make a judgment in the arbitration.
I have several times tried to convince myself of the validity of the Minister’s explanations, but I struggle even more in relation to this particular clause. My hon. Friend the Member for Cities of London and Westminster made a telling intervention—it might conflict with other requirements on him but he made it nonetheless. Nothing that the Minister has said has reassured me that the provision is necessary. The Channel Tunnel Rail Link Act—an excellent piece of work by Conservative Secretaries of State—was used as a model for the Bill. However, as has been said, that does not mean that it should be slavishly followed. Consequently, I am not inclined to withdraw the amendment.

Question put, That the amendment be made:—

The Committee divided: Ayes 5, Noes 8.

Question accordingly negatived.

Clause 62 ordered to stand part of the Bill.

Clauses63 and 64 ordered to stand part of the Bill.

Clause 65

Financial provisions

Question proposed, That the clause stand part of the Bill.

Ann Winterton: With this it will be convenient to discuss the following: New clause 2—Financial provisions (disclosure of information)—
‘(1) The Secretary of State shall publish all relevant details as to the moneys used to fund the construction and maintenance of Crossrail, beyond those monies as already provided by Parliament and set out in section 65(1).
(2) The Mayor of London shall, not less than 12 months after the granting of Royal Assent to this Act, publish and make available to all who are eligible and registered to vote in the London Mayoral or Greater London Authority elections, a statement indicating—
(a) the agreement he has undertaken and agreed with the Secretary of State for the proposals of building Crossrail, and
(b) the potential financial consequences of this agreement for London.
(3) The Secretary of State, after consultation with the Mayor of London and the Transport Commissioner for London, shall publish an annual statement setting out which bodies shall bear responsibility and liability for any costs associated with the building of Crossrail separately indicating the—
(a) costs to date, and
(b) projected costs to date.’.
New clause 3—Disposal of surplus property—
‘(1) Any land and or property acquired or used for the purposes of this Act, if deemed thereafter surplus to the needs of this Act, shall be disposed thereof.
(2) The proceeds of any disposals under subsection (1) shall be made available only for either—
(a) the purpose of paying compensation as required under this Act, or
(b) the purpose of paying for the construction of Crossrail or any such related purpose.’.

Tom Harris: The clause is the standard clause that appears in Bills that provide for the expenditure of public money. It simply provides that any expenditure by the Secretary of State under the Bill
“shall be paid out of money provided by Parliament”.
The content of the clause itself is entirely uncontentious.
With regard to the new clauses, the hon. Member for Wimbledon seeks to achieve transparency in the way that Crossrail will be funded. I am happy to say that the Government agree that transparency about Crossrail is desirable, as evidenced by the documentation that we have already made available, to which I referred in an earlier sitting. I can give comfort to the Committee that we intend to more information public in future. Yesterday, a copy of the heads of terms agreed by the Secretary of State for Transport and Transport for London were placed in the Library of the House. Some details have been redacted to protect commercial confidentiality, but the key terms of the deal between the co-sponsors of the project are now in the public domain. We and TfL need to produce the detailed arrangements that will support the heads of terms. That will involve the production of a large number of documents, which we expect to take several months to finalise. Our presumption is that those documents will be made public, again subject to the need protecting commercial interests.
Turning to new clause 2, the publication yesterday of the heads of terms means that the Government have in practice already published the information that proposed subsection (1) would require. May I make it clear that we intend to make public the relevant detailed agreements that will be negotiated over the coming months to implement the heads of terms? I believe that that will deal in large part with what proposed subsection (2) seeks to achieve. The issue of the wider financial consequences of Crossrail for London mentioned in proposed subsection (2) (b) is a matter for the Mayor. I expect that he would want to be very clear with Londoners about that, and he is subject to ongoing scrutiny by the London assembly.
Proposed subsection (3) refers to the desire for ongoing information about progress during construction. Our intention in that respect is captured by paragraph 3.11.2 of the heads of terms, which makes it clear that Cross London Rail Links Ltd will be required to publish information,
“to ensure a high level of transparency as to the progress and cost of the Crossrail Project.”
To conclude, while I sympathise with the sentiment underlying new clause 2, I think that it is unnecessary. I hope that I have made it clear that the Government and the Mayor recognise the importance of keeping the public well informed about the way in which Crossrail is taken forward, and that we are already taking steps to do that. On that basis, I hope that the hon. Member for Wimbledon will not press the new clauses to a vote.

Stephen Hammond: Certainly, we have already had one attempt this morning to introduce finance into our discussions, and the Minister congratulated the hon. Member for Richmond Park on the elegant manner in which she tried to inject the issue into this morning’s debate. I was tempted to speak in the debate on her amendment, but I resisted the temptation to do so, because I expected to have the opportunity to discuss my two new clauses and to speak on clause stand part.
As the Minister said, clause 65 provides for the expenditure incurred by the Secretary of State as a consequence of the Act to be paid for out of money provided by Parliament. It is a standard clause and we have no problems with it; we do not object to it. I have no doubt that, subject to commercial confidentiality, the Government are keen, or certainly have proved be keen, to provide details of the Crossrail package. In that spirit, I want to offer my thanks to the Minister both the briefing that he gave to the hon. Member for Carshalton and Wallington, who is a Liberal Democrat spokesman, and me. I thank him, too, for the package that he provided last night for Committee members—that package is now is in the Library. His spirit of transparency and generosity is appreciated. However—as the Minister would expect, there is always a “however”—the Bill gives explanations of the moneys provided by Parliament but not by other bodies. It does not provide, either, for updates to be delivered to Parliament on the subject of funding and costing. That was what I might have said about with the hon. Lady’s amendment this morning: although I thought it an excellent and elegant amendment, it was a one-off, and did not require an annual statement to be made to Parliament.
My new clauses go further than the hon. Lady’s amendment. We appreciate and accept the Minister’s generosity of spirit in making those disclosures, but it would be wrong of us as the Opposition not to ensure that adequate and appropriate protection is available. New clause 2 would provide such protection by making three provisions. First, it would ensure that the Secretary of State makes available to Parliament details of funding arrangements. Secondly, the Mayor of London, whoever that is at the time, will commit Londoners to extra expenditure and potential liability, and it is only right that he should provide them with a statement of the financial consequences. I am not sure that I share the Minister’s confidence that every person elected Mayor would be keen to provide such a statement. Thirdly, the new clause states that the Secretary of State shall, after consultation, provide an annual statement of costs and liability.
The justification for proposed subsection (1) is clear. The provision would allow us to scrutinise the elements of the package, to undertake proper risk analysis, and form a view on the financial probity of the providers, before considering the provisions behind the finance package and the financial model so that we could take taking a view on the associated risk. The Conservatives have said throughout the parliamentary process—I am sure that the Liberal Democrats have done so, too—that we support the principle of Crossrail, but that we would need to see the funding. The Minister has acted in a spirit of generosity and transparency, and it is appropriate that we enshrine that transparency in the Bill.
Proposed subsection (2) is simple. All councils have to provide an annual statement on how they deliver services and how those services are paid for. The subsection would not place any greater requirement on the Mayor of London. He is happy to commit Londoners to potential liability as a co-sponsor, so he should be happy to tell Londoners exactly what the financial consequences of his actions will be. I see no problem with that, and I am sure that Londoners would appreciate it.
Proposed subsection (3) would provide for an annual statement or update. As we embark on the building, maintenance and operation of Crossrail, we do need more than a snapshot in the House; we need dynamics. If there were a problem of overspend or—less likely, I suspect—underspend, or if was a delay, the new clause makes provision for Parliament to be notified of such things, which would be subject to parliamentary scrutiny. I have listened carefully to the Minister. We are grateful that he has deposited information with us, and we thank him sincerely for doing so. At the same time, I hope that he recognises that it is the Opposition’s duty to make sure that his spirit of generosity is not transitory and that it is enshrined in one of the most important parts of the Bill so that it will be available for future scrutiny. I shall therefore seek to divide the Committee on new clause 2.
New clause 3 is a simple but important housekeeping measure. This is an exceptional project, and it requires exceptional powers and exceptional discretion. We have recognised that spirit throughout. The Secretary of State has been granted powers of compulsory acquisition both within and without the scope of the Compulsory Purchase Act 1965; she has been granted rights of easement and licences; and she has been granted powers of purchase along the deemed route within and without the limits of deviation. We all accept that that is necessary and desirable.
After Crossrail is built, however, there will undoubtedly be land excess to the needs of the Crossrail operation. I am sure that any member of this Committee, particularly those who served on the Select Committee, can think of petitions they have heard where the land that is going to be used for the building of Crossrail will not be necessary for its operation. The Government and the operators of Crossrail will not necessarily want to be a landlord so that excess land should be disposed of. The proceeds from the disposal of the surplus lands should be directed to reducing the overall costs and funding the compensation payments. This is a sensible housekeeping measure and I commend it to the Committee.

Susan Kramer: I will be very brief. Obviously I was sad that those on the Conservative Front Bench could not see their way to supporting my amendment because it gave the advantage to the House of being able to give its assent to the final package on Crossrail. I, too, am very impressed by the generous amount of information that has been provided by the Minister. However, there is an issue of underlying principle that is worth establishing. We have noticed that every time there is an issue here, reference goes back to the channel tunnel rail link and no doubt future Bills will all talk about what was in this Bill. Establishing the ongoing principle on the face of the Bill that information should be disclosed on a regular basis is probably no bad item to have.
Again, although we all have a great deal of confidence in this Minister, the project runs way out into the future. It would be sad to give leeway to others to provide less disclosure than the current Government are willing and able to do. Although I shall support the new clause tabled by Conservative Members, if for some reason it should fail, will the Minister consider these matters and reflect his own attitude towards transparency in a clause that he might bring forward at a future date to ensure that providing information is an ongoing principle?

Brian Binley: I apologise to the Committee for detaining hon. Members for perhaps longer than they might have hoped, but financial accountability and especially annual reporting are vital matters. I want to talk briefly about why I believe them to be so important. Most people know that my background is in a business environment. Annual reporting creates a discipline that simply is not created in any other way. It creates an accountability that gives credibility to a project.
The second thing that annual reporting provides is the ability to put things right if they are not going right. We have seen too many projects from Governments of all political persuasions that have gone wrong because they have not been properly managed. It is all very well seeing a problem, putting money into it, and, finally, setting targets, but that is not the secret of management. The secret of management is managing the process thereafter. Very often it does not mater whether the decision made about a specific issue falls within a set of parameters, but it clearly matters if it is managed, fine tuned, tweaked and the subject of drastic effort in a way that changes a process that is clearly going wrong. Financial reporting allows a process to be looked at in a clearer way than almost any other mechanism.
As I said, a company would have to proceed along the lines that I have described, but it is not clear that that applies in this case, even if we bear in mind the constitution of the package that we are talking about with regard to Crossrail. I want to ensure that it does apply. Putting the new clause into the Bill offers a protection not only for respective Governments—because it is likely that this process will be undertaken by respective Governments as it goes on into the future—but for the taxpayer, who will contribute sizeably to the project. It is not only the taxpayer in London who will contribute, but also those throughout the rest of the country.
I therefore urge the Minister, whom I know to be keen on transparent government, to consider the process, even if on this occasion he does not accept it. At the very least, will he come back on Report with a mechanism that would accede to this request, which I am sure that he feels in his heart is sensible?

Mark Field: Just for once, let us be wise before rather than after the event. The Minister and I have been in Parliament for exactly the same time, six and a half years, and there is a sense of dÃ(c)jÃ vu as I consider many of the Bills on which I served on the Committee.
For example, the first Bill Committee that I sat on was the Proceeds of Crime Act 2002; we pointed out, time and again, the enormous costs that would go into setting up the associated agency. On the Enterprise Act 2002, we repeatedly talked about the risk of allowing too many 20-somethings to become bankrupt, but all that came to pass. On the Licensing Act 2003, I talked endlessly about the notion of 24-hour drinking and the risible idea that bringing in more flexible licensing laws would somehow lead to a Parisian drinking culture on the streets of London and of the country. Likewise, on the London Olympic Games and Paralympic Games Act 2006, we endlessly talked about the spiralling costs, and, of course, they are precisely what have come to pass.
Our biggest concern in relation to Crossrail is not the idea of it, as the project is something that we very much support, but the notion of blight if the proper funding is not put into place. I fear that, notwithstanding the assurances made by the Minister and the Prime Minister over the last six or seven weeks, the funding package for Crossrail is a good deal less robust than we would like it to be. It is for that reason that I totally support new clause 2, and my hon. Friends have put forward robust reasoning for it. I fear, however, that if we do not get this right and we do not get the proper funding in place, there will in years to come be a sort of half-Crossrail that will not do anything like as much as it is planned to do at this stage; there will be a phase 1, with phase 2 or 3 deep in the future, which will never come to pass because of the enormous, spiralling costs.
We need to get this right, and the worst of all worlds, as I have said, is that countless numbers of constituents, not only in my constituency, but in dozens across London and the south-east, will have their lives blighted by being on the Crossrail route, with very little prospect of the project coming to fruition, unless we get the funding right. Therefore, I hope that the Minister will give serious consideration to ensuring that, for once, we are genuinely wise before rather than after the event.

Tom Harris: I have already made some comments about new clause 2. Shortly, I would like to make some comments in response to the comments by the hon. Member for Wimbledon about new clause 3.
First, I would like to respond to what the hon. Member for Richmond Park has said. I do not feel that a commitment in the Bill to the kind of reporting that she is looking for would be appropriate in this case. I understand why she and other members of the Committee have belittled the notion of always using the precedent of the Channel Tunnel Rail Link Act 1996 to justify a particular clause in this Bill, but let me suggest a corollary of that. Can she, or indeed any other member of the Committee, name a piece of legislation about a large infrastructure project where this kind of reporting, aimed at creating the level of transparency that we all want to see, has been included in the Bill? It is a rhetorical question; I would be very surprised if there was an answer.
 Mr. Binley rose—

Tom Harris: We may actually have an answer.

Brian Binley: The Minister challenged us so may I ask him whether he thinks that, although there is no precedent, it is time that we set one? That is the point about this new clause. We want to improve government and I am sure that he also wants to improve it. On that basis, and in the spirit of going forward to ensure that we have more transparent government, surely he would accept that point.

Tom Harris: There is a good reason why such commitments have not been included in previous legislation. I must say to the hon. Gentleman that I am not about to make political history and create a precedent with the Crossrail Bill.
On the comments of the hon. Member for Cities of London and Westminster, I am clearly far more optimistic than he is about the robustness of the financial package that has been put together. Time will tell, but I think that the amount of work that has been put into creating that financial package will show in time that that package is extremely impressive and, I must say, robust.
The purpose of the hon. Member for Wimbledon in proposing new clause 3 is to ensure that
“Any land or property...if deemed thereafter surplus to the needs of this Act, shall be disposed thereof”
and the proceeds will be used for Crossrail-related purposes. I can assure him that this new clause is unnecessary. The Secretary of State has already given a number of undertakings on the matter of the land disposal policy. These form part of the environmental minimal requirements and she has given undertakings to Parliament on the enforcement of those requirements. The relevant paragraph in that policy is as follows:
“Where any land which has been acquired and used for the construction of Crossrail is:
(i) no longer required for the satisfactory completion of the Crossrail works;
(ii) not required in connection with the operation of Crossrail; 
it will be sold subject firstly to the Crichel Down Rules 2004 and to the extent that this does not apply, then in accordance with this policy”.
As I am sure the hon. Member for Wimbledon will recall, those rules provide for the circumstances in which land acquired under threat of compulsion but no longer required for public purposes will be offered back to the former owner. The requirement under the rules to offer land back is not unqualified.
The terms of the Crossrail land disposal policy were published in advance of the Select Committee’s consideration of the Bill. Therefore, they have formed the backdrop for many agreements reached with persons whose property would be subject to compulsory purchase as a consequence of the Bill.
On the question of the use of the proceeds, I assure the hon. Member for Wimbledon that it is integral to the funding package announced by my right hon. Friend the Prime Minister last month that the proceeds will be applied for Crossrail purposes. As the hon. Gentleman will appreciate, however, the timing of those receipts is unlikely to marry with the timing of payments of compensation and therefore they will go towards the repayment of Transport for London borrowing to finance the project.
The heads of terms between the Department for Transport and Transport for London, setting out the details of the funding arrangements, were published yesterday, as the hon. Member for Wimbledon will know. He will find in the table on uses and sources of funds, at paragraph 4.1.3 of those heads of terms, that it is envisaged that £500 million will be raised from sales of surplus land and property. With those assurances, I hope that the hon. Gentleman will consider not pressing the new clause to a Division.

Question put and agreed to.

Clause 65 ordered to stand part of the Bill.

Clause 66 ordered to stand part of the Bill.

New Clause 1

Transfer schemes: tax provisions
‘Schedule (Transfer schemes: tax provisions) (tax provisions relating to transfer schemes) has effect.’.—[Mr. Harris.]

Brought up, read the First and Second time, and added to the Bill.

New Clause 2

Financial provisions (disclosure of information)
‘(1) The Secretary of State shall publish all relevant details as to the moneys used to fund the construction and maintenance of Crossrail, beyond those monies as already provided by Parliament and set out in section 65(1).
(2) The Mayor of London shall, not less than 12 months after the granting of Royal Assent to this Act, publish and make available to all who are eligible and registered to vote in the London Mayoral or Greater London Authority elections, a statement indicating—
(a) the agreement he has undertaken and agreed with the Secretary of State for the proposals of building Crossrail, and
(b) the potential financial consequences of this agreement for London.
(3) The Secretary of State, after consultation with the Mayor of London and the Transport Commissioner for London, shall publish an annual statement setting out which bodies shall bear responsibility and liability for any costs associated with the building of Crossrail separately indicating the—
(a) costs to date, and
(b) projected costs to date.’.—[Stephen Hammond.]

Brought up, and read the First time.

Motion made, and Question put, That the clause be read a Second time:—

The Committee divided: Ayes 6, Noes 7.

Question accordingly negatived.

New Schedule 1

‘Transfer schemes: tax provisions

Part 1

Introduction

Meaning of “public body”
1 In this Schedule “public body” means a person which is a public body for the purposes of section 66 of FA 2003 (SDLT: transfers involving public bodies).

Meaning of “taxable public body” and “exempt public body”
2 (1) In this Schedule “taxable public body” means a public body which is within the charge to corporation tax.
(2) In this Schedule “exempt public body” means a public body which is exempt from corporation tax.

Interpretation: supplementary
3 (1) In this Schedule—
“CAA 2001” means the Capital Allowances Act 2001 (c. 2);
“FA”, followed by a year, means the Finance Act of that year;
“ICTA” means the Income and Corporation Taxes Act 1988 (c. 1);
“ITA 2007” means the Income Tax Act 2007 (c. 3);
“ITTOIA 2005” means the Income Tax (Trading and Other Income) Act 2005 (c. 5);
“TCGA 1992” means the Taxation of Chargeable Gains Act 1992 (c. 12);
“TMA 1970” means the Taxes Management Act 1970 (c. 9);
“transfer scheme” means a scheme made under Schedule 12 to this Act;
“transferee”, in relation to a transfer in accordance with a transfer scheme, means the person to whom the transfer is made;
“transferor”, in relation to a transfer in accordance with a transfer scheme, means the person from whom the transfer is made.
(2) So far as it relates to income tax this Schedule is to be construed as one with the Income Tax Acts.
(3) So far as it relates to capital gains tax this Schedule is to be construed as one with TCGA 1992.
(4) So far as it relates to corporation tax this Schedule is to be construed as one with the Corporation Tax Acts.
(5) So far as it relates to capital allowances this Schedule is to be construed as one with CAA 2001.

Part 2

Transfers etc between taxable public bodies

Meaning of “relevant transfer” in Part 2 of Schedule
4 In this Part of this Schedule “relevant transfer” means a transfer, in accordance with a transfer scheme, from a taxable public body to another taxable public body.

Computation of profits and losses in respect of transfer of trade
5 (1) This paragraph applies where a taxable public body (“the predecessor”) is carrying on a trade or a part of a trade and, as a result of a transfer scheme—
(a) the predecessor ceases to carry on that trade or that part of that trade, and
(b) another taxable public body (“the successor”) begins to carry on that trade or that part of it.
(2) For the purpose of computing, in relation to the time when the scheme comes into force and subsequent times, the relevant trading profits or losses of the predecessor and the successor—
(a) the trade or part is to be treated as having been a separate trade at the time of its commencement and as having been carried on by the successor at all times since its commencement as a separate trade, and
(b) the trade carried on by the successor after the time when the scheme comes into force is to be treated as the same trade as that which it is treated, by virtue of paragraph (a), as having carried on as a separate trade before that time.
(3) Where a trade or a part of a trade falls to be treated under this paragraph as a separate trade, such apportionments of receipts, expenses, assets and liabilities shall be made for the purpose of computing relevant trading profits or losses as may be just and reasonable.
(4) This paragraph is subject to the other provisions of this Part of this Schedule.
(5) In this paragraph “relevant trading profits or losses” means profits or losses under Case I of Schedule D in respect of the trade or part of a trade in question.

Transfers of trading stock
6 (1) This paragraph applies if—
(a) under a relevant transfer trading stock of the transferor is transferred to the transferee, and
(b) paragraph 5 does not apply in relation to that transfer.
(2) Sub-paragraphs (3) and (4) have effect in computing for any corporation tax purpose both the profits of the trade in relation to which the stock is trading stock immediately before the transfer takes effect (“the transferor’s trade”) and—
(a) if the stock falls immediately after the transfer takes effect to be treated as trading stock of the transferee, the profits of the trade in relation to which it falls to be treated as trading stock (“the transferee’s trade”);
(b) otherwise, the consideration given by the transferee, or the expenditure incurred by the transferee, for the acquisition of the stock.
(3) The stock must be taken to have been—
(a) disposed of by the transferor in the course of the transferor’s trade,
(b) if sub-paragraph (2)(a) applies, acquired by the transferee in the course of the transferee’s trade, and
(c) subject to that, disposed of and acquired when the transfer takes effect.
(4) The stock must be valued as if the disposal and acquisition had been for a consideration which in relation to the transferor would have resulted in neither a profit nor a loss being brought into account in respect of the disposal in the accounting period of the transferor which ends with, or is current at, the time when the transfer takes effect.
(5) In this paragraph “trading stock” has the same meaning as in section 100 of ICTA.

Capital allowances: transfer of whole trade
7 (1) This paragraph applies where a taxable public body (“the predecessor”) is carrying on a trade and, as a result of a transfer scheme—
(a) the predecessor ceases to carry on that trade, and
(b) another taxable public body (“the successor”) begins to carry on that trade.
(2) For the purposes of the allowances and charges provided for by CAA 2001, the trade is not to be treated as permanently discontinued, nor a new trade as set up; but sub-paragraphs (3) and (4) are to apply.
(3) There are to be made to or on the successor, in accordance with CAA 2001, all such allowances and charges as would, if the predecessor had continued to carry on the trade, have fallen to be made to or on the predecessor.
(4) The amounts of those allowances and charges are to be computed as if—
(a) the successor had been carrying on the trade since the predecessor began to do so, and
(b) everything done to or by the predecessor had been done to or by the successor,
but so that transfers in accordance with the scheme, so far as they relate to assets in use for the purposes of the trade, shall not be treated as giving rise to an allowance or charge.

Capital allowances: transfer of part of a trade
8 (1) Where a taxable public body (“the predecessor”) is carrying on a trade and, as a result of a transfer scheme—
(a) the predecessor ceases to carry on a trade, and
(b) another taxable public body (“the successor”) begins to carry on activities of that trade as part of a trade carried on by the successor,
then that part of the trade carried on by the successor shall be treated for the purposes of paragraph 7 as a separate trade.
(2) Where a taxable public body (“the predecessor”) is carrying on a trade and, as a result of a transfer scheme—
(a) the predecessor ceases to carry on a part of a trade, and
(b) another taxable public body begins to carry on activities of that part of that trade,
then the predecessor shall be treated for the purposes of paragraph 7 and sub-paragraph (1) as having carried on that part of its trade as a separate trade.
(3) Where activities fall to be treated for the purposes of this paragraph as a separate trade, such apportionments of receipts, expenses, assets and liabilities shall be made for the purposes of CAA 2001 as may be just and reasonable.

Capital allowances: transfer of plant or machinery
9 (1) This paragraph applies where—
(a) there is a relevant transfer of plant or machinery,
(b) paragraph 7 does not apply in relation to that transfer,
(c) the plant or machinery would be treated for the purposes of CAA 2001 as disposed of by the transferor to the transferee on the transfer taking effect, and
(d) the transfer scheme in accordance with which the transfer is made contains provision for the disposal value of the plant or machinery to be treated for the purposes of that Act as an amount specified in or determined in accordance with the scheme.
(2) For the purposes of CAA 2001—
(a) the provision mentioned in sub-paragraph (1)(d) is to have effect for determining an amount as the disposal value of the plant or machinery or the price at which a fixture is to be treated as sold,
(b) the transferee is to be treated as having incurred capital expenditure of that amount on the provision of the plant or machinery for the purposes for which it is used by the transferee on and after the taking effect of the transfer,
(c) the property is to be treated as belonging to the transferee as a result of the transferee having incurred that expenditure, and
(d) in the case of a fixture, the expenditure which falls to be treated as incurred by the transferee is to be treated for the purposes of sections 181(1) and 182(1) of that Act as being incurred by the giving of a consideration consisting in a capital sum of that amount.
(3) The provision mentioned in sub-paragraph (1)(d) for the determination of an amount may include provision for a determination—
(a) to be made by the Secretary of State in a manner described in the scheme,
(b) to be made by reference to factors so described or to the opinion of a person so described, and
(c) to be capable of being modified (on one or more occasions) in a manner and in circumstances so described.
(4) The consent of the Treasury is required for the making or modification of a determination under the provision mentioned in sub-paragraph (1)(d).
(5) The consent of the transferee is required for the modification of a determination under the provision mentioned in sub-paragraph (1)(d).
(6) As to the making of a determination or a modification of a determination under the provision mentioned in sub-paragraph (1)(d), see further paragraph 43.
(7) Expressions used in this paragraph and in Part 2 of CAA 2001 have the same meanings in this paragraph as in that Part.

Capital allowances: transfers not to be sales
10 (1) This paragraph applies for the purposes of Part 3 of CAA 2001, and the other provisions of that Act which are relevant to that Part, to a relevant transfer of the relevant interest in an industrial building or structure.
(2) Neither section 559 nor section 573 of that Act is to have effect in relation to that transfer.

Chargeable gains: assets to be treated as disposed of without a gain or a loss
11 (1) For the purposes of TCGA 1992 a disposal—
(a) constituted by a relevant transfer, or
(b) to which sub-paragraph (2) applies,
is to be taken (in relation to the person to whom the disposal is made as well as the person making the disposal) to be for a consideration such that no gain or loss accrues to the person making the disposal.
(2) This sub-paragraph applies to a disposal if—
(a) it is made in accordance with provision contained in a transfer scheme by virtue of paragraph 5 or 11 of Schedule 12 to this Act,
(b) the person making the disposal and the person to whom the disposal is made are taxable public bodies, and
(c) each of those persons is either the transferor or a transferee under the scheme.
(3) Sub-paragraph (1) is subject to paragraph 12.

Chargeable gains: roll-over relief
12 (1) This paragraph applies if—
(a) but for section 154 of TCGA 1992 (depreciating assets) a held-over gain would have been carried forward to a depreciating asset, and
(b) the asset is the subject of a relevant transfer.
(2) Section 154 is to have effect as if the gain had accrued to, and the claim for it to be held over had been made by, the transferee and as if the transferor’s acquisition of the depreciating asset had been the transferee’s acquisition of it.
(3) Expressions used in this paragraph and in section 154 have the same meanings in this paragraph as in that section.

Continuity in relation to transfer of intangible assets
13 (1) For the purposes of Schedule 29 to FA 2002—
(a) a relevant transfer of a chargeable intangible asset of the transferor is to be treated as a tax-neutral transfer, and
(b) an intangible fixed asset which is an existing asset of the transferor at the time of a relevant transfer is to be treated, on and after the transfer, as an existing asset in the hands of the transferee.
(2) Expressions used in this paragraph and in that Schedule have the same meanings in this paragraph as in that Schedule.

Continuity in relation to loan relationships
14 (1) For the purposes of the application of Chapter 2 of Part 4 of FA 1996 (loan relationships) in relation to a relevant transfer, the transferee and the transferor are to be treated as if, at the time of the transfer, they were members of the same group.
(2) In sub-paragraph (1) the reference to being members of the same group must be construed in accordance with paragraph 12(8) of Schedule 9 to that Act.

Continuity in relation to derivative contracts
15 (1) For the purposes of the application of Schedule 26 to FA 2002 (derivative contracts) in relation to a relevant transfer, the transferee and the transferor are to be treated as if, at the time of the transfer, they were members of the same group.
(2) In sub-paragraph (1) the reference to being members of the same group must be construed in accordance with paragraph 28(6) of that Schedule.

Leased assets
16 (1) This paragraph applies for the purposes of section 781 of ICTA (assets leased to traders and others) where—
(a) the interest of the lessor or the lessee under a lease, or any other interest in an asset, is transferred under a relevant transfer, or
(b) a lease, or any other interest in a lease, is granted by a taxable public body to another taxable public body in accordance with provision contained by virtue of paragraph 5 or 11 of Schedule 12 to this Act in a transfer scheme.
(2) Section 783(4) of ICTA is to be disregarded and the transfer or grant is to be treated as made without any capital sum having been obtained in respect of the interest or lease by the transferor or grantor.
(3) In the case of the transfer of an interest under a lease, payments made by the transferor under the lease before the transfer takes effect are to be treated as if they had been made under that lease by the transferee.
(4) Expressions used in this paragraph and in sections 781 to 785 of ICTA have the same meanings in this paragraph as in those sections.

Part 3

Transfers etc from taxable public bodies to exempt public bodies

Meaning of “relevant transfer” in Part 3 of Schedule
17 In this Part of this Schedule “relevant transfer” means a transfer, in accordance with a transfer scheme, from a taxable public body to an exempt public body.

Transfers of trading stock
18 (1) This paragraph applies if under a relevant transfer trading stock of the transferor is transferred to the transferee.
(2) Sub-paragraphs (3) and (4) have effect in computing for any corporation tax purpose the profits of the trade in relation to which the stock is trading stock immediately before the transfer takes effect (“the transferor’s trade”).
(3) The stock must be taken to have been—
(a) disposed of by the transferor in the course of the transferor’s trade, and
(b) subject to that, disposed of when the transfer takes effect.
(4) The value of the stock is to be taken to be—
(a) if consideration is given to the transferor in respect of the transfer, an amount equal to the value of the consideration, or
(b) if no such consideration is given, nil.
(5) For the purposes of this paragraph consideration given to a person connected with the transferor is to be treated as given to the transferor.
(6) In this paragraph “trading stock” has the same meaning as in section 100 of ICTA.
(7) For the purposes of this paragraph whether a person is connected with another person is determined in accordance with section 839 of ICTA (connected persons).

Capital allowances: determination of disposal value of plant or machinery
19 (1) This paragraph applies to a relevant transfer of plant or machinery which is a disposal event for the purposes of Part 2 of CAA 2001 (capital allowances for plant and machinery).
(2) For the purposes of the application of section 61 of that Act in relation to the transferor, the disposal value of the plant or machinery is to be treated—
(a) if a capital sum is received by the transferor by way of consideration or compensation in respect of the transfer, as an amount equal to that sum, or
(b) if no such sum is received, as nil.
(3) For the purposes of this paragraph a sum received by a person connected with the transferor is to be treated as received by the transferor.
(4) Section 88 of CAA 2001 (sales at an undervalue) is to be disregarded.
(5) This paragraph is subject to sections 63(5) and 68 of CAA 2001.

Capital allowances: determination of disposal value of fixtures
20 (1) This paragraph applies to a relevant transfer if—
(a) it is a disposal event for the purposes of Part 2 of CAA 2001, and
(b) by virtue of the transfer a person is treated by section 188 of that Act as ceasing to own a fixture.
(2) For the purposes of the application of section 196 of that Act in relation to the transferor, the disposal value of the fixture is to be treated—
(a) if a capital sum is received by the transferor by way of consideration or compensation in respect of the transfer, as an amount equal to that portion of that sum which, if the person to whom the disposal is made were entitled to an allowance, would fall to be treated for the purposes of Part 2 of that Act as expenditure incurred by that person on the provision of the fixture, or
(b) if no such sum is received, as nil.
(3) For the purposes of this paragraph a sum received by a person connected with the transferor is to be treated as received by the transferor.
(4) This paragraph is subject to section 63(5) of CAA 2001.

Capital allowances: determination of capital value of industrial buildings etc.
21 (1) This paragraph applies for the purposes of Part 3 of CAA 2001, and the other provisions of that Act which are relevant to that Part, in relation to a relevant transfer of the relevant interest in an industrial building or structure.
(2) This paragraph is subject to section 36 of FA 2007 (which makes provision about balancing adjustments etc under Part 3 of CAA 2001).
(3) The transfer is to be treated as a sale of that relevant interest.
(4) The net proceeds of that sale are to be treated—
(a) if a capital sum is received by the transferor by way of consideration or compensation in respect of the transfer, as an amount equal to that sum, or
(b) if no such sum is received, as nil.
(5) For the purposes of this paragraph a sum received by a person connected with the transferor is to be treated as received by the transferor.
(6) Sections 567 to 570 of CAA 2001 (sales treated as being for alternative amount) are not to have effect in relation to that sale.

Chargeable gains: assets to be treated as disposed of without a gain or a loss
22 (1) For the purposes of TCGA 1992 a disposal—
(a) constituted by a relevant transfer, or
(b) to which sub-paragraph (2) applies,
is to be taken to be for a consideration such that no gain or loss accrues to the person making the disposal.
(2) This sub-paragraph applies to a disposal if—
(a) it is made in accordance with provision contained in a transfer scheme by virtue of paragraph 5 or 11 of Schedule 12 to this Act,
(b) the person making the disposal is a taxable public body,
(c) the person to whom the disposal is made is an exempt public body, and
(d) each of those persons is either the transferor or a transferee under the scheme.

Neutral effect of transfer of intangible assets
23 (1) For the purposes of Schedule 29 to FA 2002, a relevant transfer of a chargeable intangible asset of the transferor is to be treated as not involving any realisation of the asset by the transferor.
(2) Expressions used in this paragraph and in that Schedule have the same meanings in this paragraph as in that Schedule.

Neutral effect of transfer for loan relationships and derivative contracts
24 No credit or debit shall be required or allowed, in respect of a relevant transfer, to be brought into account in the transferor’s case—
(a) for the purposes of Chapter 2 of Part 4 of FA 1996 (loan relationships), or
(b) for the purposes of Schedule 26 to FA 2002 (derivative contracts).

Leased assets
25 (1) This paragraph applies for the purposes of section 781 of ICTA (assets leased to traders and others) where—
(a) the interest of the lessor or the lessee under a lease, or any other interest in an asset, is transferred under a relevant transfer, or
(b) a lease, or any other interest in a lease, is granted by a taxable public body to an exempt public body in accordance with provision contained by virtue of paragraph 5 or 11 of Schedule 12 to this Act in a transfer scheme.
(2) Section 783(4) of ICTA is to be disregarded and the transfer or grant is to be treated as made without any capital sum having been obtained in respect of the interest or lease by the transferor or grantor.
(3) Expressions used in this paragraph and in sections 781 to 785 of ICTA have the same meanings in this paragraph as in those sections.

Part 4

Transfers from exempt public bodies to taxable public bodies

Meaning of “relevant transfer” in Part 4 of Schedule
26 In this Part of this Schedule “relevant transfer” means a transfer, in accordance with a transfer scheme, from an exempt public body to a taxable public body.

Capital allowances: transfer of plant or machinery
27 (1) This paragraph applies where—
(a) there is a relevant transfer of plant or machinery,
(b) the plant or machinery would have been treated for the purposes of CAA 2001 (had the transferor incurred expenditure qualifying for allowances under Part 2 of that Act on the provision of the plant or machinery) as disposed of by the transferor to the transferee on the transfer taking effect, and
(c) the transfer scheme in accordance with which the transfer is made contains provision for the transferee to be treated for the purposes of that Act as having incurred capital expenditure of an amount specified in or determined in accordance with the scheme on the provision of the plant or machinery.
(2) For the purposes of CAA 2001—
(a) the transferee is to be treated as having incurred capital expenditure of that amount on the provision of the plant or machinery for the purposes for which it is used by the transferee on and after the taking effect of the transfer,
(b) the property is to be treated as belonging to the transferee as a result of the transferee having incurred that expenditure, and
(c) in the case of a fixture, the expenditure which falls to be treated as incurred by the transferee is to be treated for the purposes of sections 181(1) and 182(1) of that Act as being incurred by the giving of a consideration consisting in a capital sum of that amount.
(3) The provision mentioned in sub-paragraph (1)(c) for the determination of an amount may include provision for a determination—
(a) to be made by the Secretary of State in a manner described in the scheme,
(b) to be made by reference to factors so described or to the opinion of a person so described, and
(c) to be capable of being modified (on one or more occasions) in a manner and in circumstances so described.
(4) The consent of the Treasury is required for the making or modification of a determination under the provision mentioned in sub-paragraph (1)(c).
(5) The consent of the transferee is required for the modification of a determination under the provision mentioned in sub-paragraph (1)(c).
(6) As to the making of a determination or a modification of a determination under the provision mentioned in sub-paragraph (1)(c), see further paragraph 43.
(7) Expressions used in this paragraph and in Part 2 of CAA 2001 have the same meanings in this paragraph as in that Part.

Capital allowances: determination of capital value of industrial buildings etc.
28 (1) This paragraph applies where there is a relevant transfer of the relevant interest in an industrial building or structure and the transfer scheme in accordance with which the transfer is made contains provision specifying for the purposes of section 311 of CAA 2001—
(a) the amount to be taken as the amount of the residue of qualifying expenditure immediately after the event, and
(b) the period to be taken as the period from the date of the event to the end of the period of 25 years beginning with the day on which the building or structure was first used.
(2) For the purposes of that section—
(a) the transfer is to be treated as the occurrence of a relevant event,
(b) the residue of qualifying expenditure immediately after the event is to be taken to be the amount specified by virtue of sub-paragraph (1)(a), and
(c) the period from the date of the event to the end of the period of 25 years beginning with the day on which the building or structure was first used is to be taken to be the period specified by virtue of sub-paragraph (1)(b).
(3) Expressions used in this paragraph and in Part 3 of CAA 2001 have the same meanings in this paragraph as in that Part.

Part 5

Other provisions concerning transfers between public bodies

Meaning of “relevant transfer” in Part 5 of Schedule
29 In this Part of this Schedule “relevant transfer” means a transfer, in accordance with a transfer scheme, from a public body to another public body.

Trading losses: change in ownership
30 (1) This paragraph applies to a relevant transfer of all the issued share capital of a company (the “transferred company”).
(2) For the purposes of sections 768 to 768E of ICTA, the transfer is not to be taken to result in a change in the ownership of—
(a) the transferred company, or
(b) a company which is a wholly-owned subsidiary of the transferred company when the transfer takes effect.

Chargeable gains: degrouping charges
31 (1) This paragraph applies if a company (“the degrouped company”)—
(a) acquired an asset from another company at a time when both were members of the same group of companies (“the old group”),
(b) ceases by virtue of a relevant transfer to be a member of the old group, and
(c) becomes by virtue of the transfer a member of the same group of companies as the transferee (“the new group”).
(2) Section 179 of TCGA 1992 (company ceasing to be member of group) is not to treat the degrouped company as having by virtue of the transfer sold and immediately reacquired the asset.
(3) Where sub-paragraph (2) has applied to an asset, section 179 of TCGA 1992 is to have effect on and after the first subsequent occasion on which the degrouped company ceases to be a member of the new group otherwise than by virtue of a relevant transfer as if—
(a) the degrouped company, and
(b) the company from which it acquired the asset,
had been members of the new group at the time of acquisition.
(4) If, disregarding any preparatory transactions, a company would be regarded by virtue of a relevant transfer—
(a) as ceasing to be a member of a group of companies for the purposes of section 179 of TCGA 1992 (and, accordingly, of this paragraph), or
(b) as becoming a member of a group of companies for the purposes of this paragraph,
it is to be regarded for those purposes as so doing by virtue of the relevant transfer and not by virtue of any preparatory transactions.
(5) In this paragraph “preparatory transactions” means anything done under or by virtue of this Act for the purpose of initiating, advancing or facilitating the relevant transfer in question.
(6) Expressions used in this paragraph and in section 179 of TCGA 1992 have the same meanings in this paragraph as in that section.

Stamp duty
32 (1) Stamp duty is not to be chargeable—
(a) on a transfer scheme in the case of which the transferor and each transferee is a public body, or
(b) on an instrument certified by the Secretary of State to the Commissioners for Her Majesty’s Revenue and Customs as made for the purposes of such a transfer scheme, or as made for purposes connected with such a transfer scheme.
(2) But where, by virtue of sub-paragraph (1), stamp duty is not chargeable on a scheme or instrument, the scheme or instrument is to be treated as duly stamped only if—
(a) in accordance with section 12 of the Stamp Act 1891 (c. 39) it has been stamped with a stamp denoting either that it is not chargeable to duty or that it has been duly stamped, or
(b) it is stamped with the duty to which it would be chargeable apart from sub-paragraph (1).
(3) In this paragraph “instrument” has the same meaning as in the Stamp Act 1891 (c. 39).

Part 6

Transfers etc involving private persons

Meaning of “relevant transfer” in Part 6 of Schedule
33 In this Part of this Schedule “relevant transfer” means a transfer, in accordance with a transfer scheme, from or to a person other than a public body.

Transfers of trading stock
34 (1) This paragraph applies if under a relevant transfer trading stock of the transferor is transferred to the transferee.
(2) Sub-paragraphs (3) and (4) have effect in computing for any corporation tax or income tax purpose both the profits of the trade in relation to which the stock is trading stock immediately before the transfer takes effect (“the transferor’s trade”) and—
(a) if the stock falls immediately after the transfer takes effect to be treated as trading stock of the transferee, the profits of the trade in relation to which it falls to be treated as trading stock (“the transferee’s trade”);
(b) otherwise, the consideration given by the transferee, or the expenditure incurred by the transferee, for the acquisition of the stock.
(3) The stock must be taken to have been—
(a) disposed of by the transferor in the course of the transferor’s trade,
(b) if sub-paragraph (2)(a) applies, acquired by the transferee in the course of the transferee’s trade, and
(c) subject to that, disposed of and acquired when the transfer takes effect.
(4) The value of the stock is to be taken to be—
(a) if consideration is given to the transferor in respect of the transfer, an amount equal to the value of the consideration, or
(b) if no such consideration is given, nil.
(5) For the purposes of this paragraph consideration given to a person connected with the transferor is to be treated as given to the transferor.
(6) In this paragraph “trading stock” has the same meaning as in section 100 of ICTA (as respects corporation tax) or section 174 of ITTOIA 2005 (as respects income tax).
(7) For the purposes of this paragraph whether a person is connected with another person is determined in accordance with section 839 of ICTA (as respects corporation tax) or section 993 of ITA 2007 (as respects income tax).

Capital allowances: determination of disposal value of plant or machinery
35 (1) This paragraph applies to a relevant transfer of plant or machinery which is a disposal event for the purposes of Part 2 of CAA 2001 (capital allowances for plant and machinery).
(2) For the purposes of the application of section 61 of that Act (disposal events and disposal value) in relation to the transferor, the disposal value of the plant or machinery is to be treated—
(a) if a capital sum is received by the transferor by way of consideration or compensation in respect of the transfer, as an amount equal to that sum, or
(b) if no such sum is received, as nil.
(3) For the purposes of this paragraph a sum received by a person connected with the transferor is to be treated as received by the transferor.
(4) Section 88 of CAA 2001 (sales at an undervalue) is to be disregarded.
(5) This paragraph is subject to sections 63(5) and 68 of CAA 2001.

Capital allowances: determination of disposal value of fixtures
36 (1) This paragraph applies to a relevant transfer if—
(a) it is a disposal event for the purposes of Part 2 of CAA 2001, and
(b) by virtue of the transfer a person is treated by section 188 of that Act as ceasing to own a fixture.
(2) For the purposes of the application of section 196 of that Act in relation to the transferor, the disposal value of the fixture is to be treated—
(a) if a capital sum is received by the transferor by way of consideration or compensation in respect of the transfer, as an amount equal to that portion of that sum which falls (or, if the person to whom the disposal is made were entitled to an allowance, would fall) to be treated for the purposes of Part 2 of that Act as expenditure incurred by that person on the provision of the fixture, or
(b) if no such sum is received, as nil.
(3) For the purposes of this paragraph a sum received by a person connected with the transferor is to be treated as received by the transferor.
(4) This paragraph is subject to section 63(5) of CAA 2001.

Capital allowances: section 265 of CAA 2001 not to apply in relation to transferee
37 (1) This paragraph applies in relation to a relevant transfer.
(2) For the purposes of the application of Part 2 of CAA 2001 in relation to the transferee, section 265 of that Act (successions: general) is to be disregarded.

Capital allowances: determination of capital value of industrial buildings etc.
38 (1) This paragraph applies for the purposes of Part 3 of CAA 2001, and the other provisions of that Act which are relevant to that Part, in relation to a relevant transfer of the relevant interest in an industrial building or structure.
(2) This paragraph is subject to section 36 of FA 2007 (which makes provision about balancing adjustments etc under Part 3 of CAA 2001).
(3) The transfer is to be treated as a sale of that relevant interest.
(4) The net proceeds of that sale are to be treated—
(a) if a capital sum is received by the transferor by way of consideration or compensation in respect of the transfer, as an amount equal to that sum, or
(b) if no such sum is received, as nil.
(5) For the purposes of this paragraph a sum received by a person connected with the transferor is to be treated as received by the transferor.
(6) Sections 567 to 570 of CAA 2001 (sales treated as being for alternative amount) are not to have effect in relation to that sale.

Chargeable gains: disposals not to be treated as made at market value
39 (1) Section 17 of TCGA 1992 (disposals and acquisitions treated as made at market value) is not to have effect in relation to—
(a) a disposal constituted by a relevant transfer,
(b) a disposal to which sub-paragraph (2) applies, or
(c) the acquisition made by the person to whom the disposal is made;
but this sub-paragraph does not apply if the person making the disposal is connected with the person making the acquisition.
(2) This sub-paragraph applies to a disposal if—
(a) it is made in accordance with provision contained in a transfer scheme by virtue of paragraph 5 or 11 of Schedule 12 to this Act,
(b) the person making the disposal or the person to whom the disposal is made is a person other than a public body, and
(c) each of those persons is either the transferor or a transferee under the scheme.
(3) If sub-paragraph (1) applies to the disposal of an asset, the disposal is to be taken (in relation to the person making the acquisition as well as the person making the disposal) to be—
(a) in a case where consideration in money or money’s worth is given by the person making the acquisition or on his behalf in respect of the vesting of the asset in him, for a consideration equal to the amount or value of that consideration, or
(b) in a case where no such consideration is given, for a consideration of nil.

Loan relationships
40 (1) Paragraph 11 of Schedule 9 to FA 1996 (transactions not at arm’s length) is not to have effect where, as a result of a relevant transfer, the transferee replaces the transferor as a party to a loan relationship.
(2) Expressions used in this paragraph and in Chapter 2 of Part 4 of FA 1996 have the same meanings in this paragraph as in that Chapter.

Part 7

Other provisions concerning transfers

Chargeable gains: value shifting
41 No transfer scheme is to be regarded as a scheme or arrangement for the purposes of section 30 of TCGA 1992.

Group relief
42 The power of the Secretary of State to make a transfer scheme is not to be regarded as constituting—
(a) arrangements falling within section 410(1) or (2) of ICTA (arrangements for transfer of company to another group or consortium), or
(b) option arrangements for the purposes of paragraph 5B of Schedule 18 to ICTA.

Modification of transfer schemes and determinations under paragraph 9(1)(d) or 27(1)(c): companies
43 (1) This paragraph applies if—
(a) a company delivers a company tax return,
(b) subsequently, an event mentioned in sub-paragraph (2) below occurs, and
(c) as a result of that event, the return is incorrect.
(2) The events are—
(a) the making of an agreement modifying a transfer scheme under paragraph 14 of Schedule 12 to this Act;
(b) a determination or modification of a determination under the provision mentioned in paragraph 9(1)(d) or 27(1)(c) above.
(3) The return may be amended under paragraph 15 of Schedule 18 to FA 1998 so as to remedy the error, ignoring any time limit which would otherwise prevent that happening.
(4) But an amendment may not be made in reliance on sub-paragraph (3) above more than 12 months after the end of the accounting period of the company during which (as the case may be)—
(a) the agreement is made, or
(b) the determination or modification of a determination is made.
(5) Sub-paragraphs (6) and (7) below apply if the company does not amend the return so as to remedy the error before the end of that 12 month period.
(6) A discovery assessment or a discovery determination may be made in relation to the error, ignoring any time limit which would otherwise prevent that happening.
(7) But such an assessment or determination may not be made in reliance on sub-paragraph (6) above more than 24 months after the end of the accounting period mentioned in sub-paragraph (4) above.
(8) Expressions used in this paragraph and in Schedule 18 to FA 1998 have the same meaning in this paragraph as in that Schedule.

Modification of transfer schemes: other persons and partnerships
44 (1) This paragraph applies if—
(a) a person delivers a return under section 8, 8A or 12AA of TMA 1970,
(b) subsequently, an agreement is made modifying a transfer scheme under paragraph 14 of Schedule 12 to this Act, and
(c) as a result of that, the return is incorrect.
(2) The return may be amended under section 9ZA or 12ABA of TMA 1970 so as to remedy the error, ignoring any time limit which would otherwise prevent that happening.
(3) But an amendment may not be made in reliance on sub-paragraph (2) above more than 12 months after the end of the year of assessment during which the agreement modifying the transfer scheme is made.
(4) If the return is amended under section 12ABA in reliance on sub-paragraph (2) above, subsection (3) of that section applies, ignoring any time limit which would otherwise prevent the officer from proceeding under that subsection.
(5) Sub-paragraphs (6) and (7) below apply if the return is not amended under section 9ZA or 12ABA so as to remedy the error before the end of the 12 month period mentioned in sub-paragraph (3) above.
(6) An officer of Revenue and Customs may proceed under section 29(1) or 30B(1) and (2) of TMA 1970 in relation to the error, ignoring any time limit which would otherwise prevent the officer from so proceeding.
(7) But an assessment or an amendment may not be made in reliance on sub-paragraph (6) above more than 24 months after the end of the year of assessment mentioned in sub-paragraph (3) above.

Power to make further provision in relation to transfer schemes
45 (1) The Treasury may by regulations make provision for varying the way in which a relevant tax has effect from time to time (including by virtue of this Schedule) in relation to—
(a) any property, rights or liabilities transferred in accordance with a transfer scheme, or
(b) anything done for the purposes of, or in relation to, or in consequence of, the transfer of any property, rights or liabilities in accordance with a transfer scheme.
(2) The provision that may be made under sub-paragraph (1)(a) includes, in particular, provision for—
(a) a tax provision not to apply, or to apply with modifications, in relation to any property, rights or liabilities transferred;
(b) any property, rights or liabilities transferred to be treated in a specified way for the purposes of a tax provision;
(c) the Secretary of State to be required or permitted, with the consent of the Treasury, to determine, or to specify the method for determining, anything which needs to be determined for the purposes of any tax provision so far as relating to any property, rights or liabilities transferred.
(3) The provision that may be made under sub-paragraph (1)(b) includes, in particular, provision for—
(a) a tax provision not to apply, or to apply with modifications, in relation to anything done for the purposes of, or in relation to, or in consequence of, the transfer;
(b) anything done for the purposes of, or in relation to, or in consequence of, the transfer to have or not to have a specified consequence or to be treated in a specified way;
(c) the Secretary of State to be required or permitted, with the consent of the Treasury, to determine, or to specify the method for determining, anything which needs to be determined for the purposes of any tax provision so far as relating to anything done for the purposes of, or in relation to, or in consequence of, the transfer.
(4) Regulations under sub-paragraph (1) may amend this Schedule (apart from this paragraph).
(5) Regulations under sub-paragraph (1) may—
(a) make such supplementary, incidental or consequential provision as the Treasury think fit, and
(b) make different provision for different cases.
(6) The power to make regulations under sub-paragraph (1) shall be exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of the House of Commons.
(7) In this paragraph references to any property, rights or liabilities transferred in accordance with a transfer scheme include references to any property, rights or liabilities transferred, or any interests, rights or liabilities created, by virtue of paragraph 5 or 11 of Schedule 12 to this Act.
(8) In this paragraph references to the transfer of any property, rights or liabilities in accordance with a transfer scheme include references to the transfer of any property, rights or liabilities, or the creation of any interests, rights or liabilities, by virtue of paragraph 5 or 11 of Schedule 12 to this Act.
(9) In this paragraph—
“relevant tax” means income tax, corporation tax, capital gains tax, stamp duty, stamp duty land tax or stamp duty reserve tax, and
“tax provision” means a provision of an enactment about a relevant tax.
(10) In sub-paragraph (9) “enactment” includes an enactment contained in an instrument made under an Act.
(11) Paragraph 18(3) of Schedule 12 to this Act applies for the purposes of this paragraph as it applies for the purposes of that Schedule.

Consequential amendment
46 In section 35(3)(d) of TCGA 1992 (no gain no loss disposals), after sub-paragraph (xvii) insert—
“(xviii) paragraph 11 or 22 of Schedule (Transfer schemes: tax provisions) to the Crossrail Act 2008.”’.—[Mr. Tom Harris.]

Brought up, read the First and Second time, and added to the Bill.

Question proposed, That the Chairman do report the Bill, as amended, to the House.

Tom Harris: I want to take this opportunity to thank you, Lady Winterton, for your service as Chair to the Committee. As I predicted in our first sitting, it has been a pleasure to serve under your chairmanship. You have been extremely clear and genuinely helped the progress of the Bill. I also thank the Clerk, the Hansard team, the police officers who have managed to keep order, my own officials whose advice has been absolutely invaluable and, of course, my private secretary, Sandra St. Louis.
I noticed the hon. Member for Wimbledon looking with envy at the ranks of officials who offer me advice. May I thank him for his very positive approach to the Bill? It was a pleasure to debate some of the issues with him and with the hon. Member for Richmond Park. I am not sure whether it is normally done, but when there are Whips around it is never a bad thing to pay tribute to the hon. Member for Alyn and Deeside for his contribution and help throughout this process. If I have missed anyone I apologise.

Stephen Hammond: May I echo the Minister’s remarks? It has been a pleasure to serve under your chairmanship, Lady Winterton. We have undertaken these proceedings in an orderly and timely way. I am grateful for your forbearance to those of us who jumped up at the wrong time and in the wrong place. I think that the Committee has been characterised by the words, “Channel Tunnel Rail Link Act”, “compensation”, “arbitration” and, occasionally, “accountability”.

Tom Harris: And “any other relevant parties”.

Stephen Hammond: Indeed. According to my count, the Minister kindly said that if I withdrew three of my amendments, he would bring them back on Report. On that basis, I count the score as Opposition 3: Government 104. None the less, I pay tribute to the Minister for his genuine spirit of transparency in obtaining information for us and debating with us. Like him, I thank the Clerk for his invaluable help and assistance. I thank the Hansard reporters and the police. I thank my colleagues, my hon. Friends the Members for Cities of London and Westminster, for Ilford, North, for Northampton, South, and for Rugby and Kenilworth.
Finally, I thank those who have given the Minister divine inspiration, which has been extremely helpful in moving the Committee forward. In the same vein of tribute, I thank my researcher, who has given me divine inspiration at times. I calculated that as Opposition 1: Government 6. These proceedings have been useful and helpful, and Members on both sides of the Committee will agree that we wish to give the Bill speedy, yet proper, scrutiny in the House. I think that we can be pleased with what we have tried to do in Committee.

Susan Kramer: I will be brief, but I should like to take the opportunity to express my thanks for your patience and generosity, Lady Winterton. I know, from my little experience in working on such Bills, that it is genuinely appreciated. I wish to express that same sense of appreciation to the Public Bill Office and to the Clerk. They make a great deal of difference when one is a novice. Their assistance in getting things drafted, even elegantly drafted, was valuable. I thank the Hansard reporters and the police. I would thank my colleagues, but that is somewhat tricky under the circumstances. I express thanks, however, to my hon. Friend the Member for Carshalton and Wallington who covered for me when I was unavoidably absent for several hours. I appreciate his generosity, as he acted purely from kindness of spirit.
The views that have been expressed are all positively in favour of Crossrail. That is an important message that needs to go out as the Bill makes its progress through the House. A number of markers have been put down, particularly on disclosure and the wish of the House to know the details and to understand the financial structure of the Bill. Such things should not be forgotten, even though those votes did not necessarily carry the day. I thank the Minister for his willingness to provide information and to be supportive. I only wish that all the Ministers with whom I have dealt in my two years in the House took a similar latitude.

Ann Winterton: Before I put the final question, on behalf of everyone who has been thanked, may I thank members of the Committee for their thanks? It has been a pleasure to chair the Bill. We have debated in great good spirit and a lot of kindly humour, and it has genuinely been a very pleasant experience. It has also been interesting to watch a Minister on his maiden voyage in Committee, and we wish him well for the future: the same goes for the Opposition spokespeople. We are always indebted to the Clerks Department and to our Clerk in particular for his very valuable advice, to the reporters of the Official Report and to the police who have ensured that nothing untoward happened in the Committee.

Question put and agreed to.

Bill, as amended, to be reported

Committee rose at ten minutes past Six o’clock.